Manufacturing PMI is a leading indicator and it’s usually released during early month. Traders pay attention to this release for surprises as this survey may help to shape the general trend of the market. Here is the forecast:
4:30am (NY Time) UK Manufacturing PMI Forecast 57.1 Previous 57.5
ACTION: GBP/USD BUY 59.1 SELL 55.0
The Trade Plan
We are looking for a tradable deviation (or the difference between the forecast figure and the actual release figure) of 2.0, and because this is a leading indicator and its impact may hint that the future trend of other economic indicators (such as inventory, employment, retail sales, etc..) , therefore market should react to this release with volatility if we get our deviation.
We will be looking to BUY GBP/USD if we get a 59.1 or better, or looking to SELL GBP/USD if we get a 55.0 or worse, we’ll be using the Retracement Trading Method to trade this release.
The Market
The Manufacturing PMI is forecasted at 57.1. Since PMI’s medium point is at 50, this forecast is considered as a positive release (above the 50 level means expansion in the manufacturing sector). If we get a 60 or better release, we should see some strong demand in the GBP. If we were to get a 55 or worse, market’s reaction could be muted or somewhat limited. With BOE rendering its rate decision on Thursday, market could be sitting on the sideline waiting for direction. We should do the same. It is possible some BOE officials could be commenting this week prior to the rate decision, so trust me on sitting on the sidelines, you’ll thank me later.
Important Observation:
We can expect GBP/USD to move 50 pips within the hour if it is hit. With GBP gaining momentum in the past few weeks and the fact that fundamental outlook from UK is looking much better compared to both US and Europe, it is possible we may see limited decline even if we get our SELL deviation. I’d be careful at taking a SELL trade from this release…
DEFINITION
“UK Manufacturing PMI is a survey of purchasing managers in the manufacturing sector on various economic activities, including inventory, employment, orders, etc… A higher than 50 reading means expansion, or a less than 50 reading means contraction.”
Live Video On Previous UK Manufacturing PMI Release:
[flv:http://www.newsprofiteer.com/100109-ukmanufpmi/100109-ukmanufpmi.mp4 480 360]
Related posts:
- UK Manufacturing PMI 10/01/09
- Forex Trade Plan For UK Manufacturing PMI 09/01/10
- Forex News Trade UK Manufacturing PMI 6/1/11
- Forex Trading Plan For UK Manufacturing PMI 07/01/10
- Forex Trading Plan For UK Manufacturing PMI 10/01/10
- US ISM Manufacturing PMI Forex Trading Plan & Video 08/02/10
- UK Manufacturing PMI m/m 12/01/09
- UK Manufacturing PMI 11/02/09
- UK Manufacturing PMI 09/01/09
- UK Manufacturing PMI 01/04/10
{ 8 comments… read them below or add one }
I’ve been looking at your vids and they teach me a lot… thank you for that. Does your E-book cover stuff like that? Im planning on buying it..
Thanks a lot
Yes, my ebook covers my teachings.
Hello, Mr, Henry
Where web site that can i see or know about the news release ? like ur one, please let me know,
thanks your so much.
Proh.
You can get it from Tradethenews.com, it is not free but completely worth it.
Or you can get it from Forexfactory, it is a bit slow.
hello sir place i have comment on ur web befor that i cant understand ur forecast because i don’t know the indicator ur using to identify which one is buy 59.1 or sell 55.0 i have try to use the forecast u been sending me but i cant because all the indicators that i’m using none gives such information place can u give me the indicator or teach me how to use the news u can reply through my mail.
thanks for ur help.
stephen.
Its not an indicator, it is NEWS RELEASE, its also called ECONOMIC INDICATOR.
p/s i can’t understand them is there any way u can help out at list to give me an insight of how to apply the news release [economic indicator] to my day to day trading.
go to my website and in the resources look for trigger report.
http://www.newsprofiteer.com/forex-news-trading.html
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