Global Macro Analysis About Impact of US Manufacturing Production on GBPUSD
I wrote this article on June 2, 2016 for one of the most popular Forex brokers in Russia. The article was a market overview for the day that included a comprehensive fundamental analysis about US manufacturing Purchasing Managers’ Index data and its impact on the GBPUSD. The analysis made specific trading recommendation by combing fundamental developments with technical analysis.
Bears in Control Amid improving US manufacturing PMI
At GMT 9:30 a.m., financial information services company Markit released the UK’s manufacturing purchasing managers’ index (PMI), which came out at 50.1 against an analysts’ consensus forecast of 49.6. Compared to last month’s manufacturing PMI reading of 49.4, it was a minor, but well noted improvement that set a bullish fundamental outlook for the GBPUSD in the early morning.
Later during the afternoon, at GMT 3:00 p.m., the Arizona-based Institute for Supply Management released its manufacturing PMI for of the United States, which came out at 51.3 against an analysts’ consensus forecast of 50.5.
From a technical perspective, the GBPUSD remained bearish since the pair broke below the hourly uptrend line on May 27. Furthermore, the GBPUSD formed a bearish outside bar (BEOB) on May 31, after the price fell by around 260 pips on the last day of the month.
Let’s have a look at how yesterday’s market events influenced the GBPUSD. The better than expected manufacturing PMI from the UK did help push the GBPUSD price in the early Tokyo trading session, but by midday, the Bears took control of the market. The improving US manufacturing PMI from the ISM then consolidated the bearish momentum, and by the end of the New York trading session, the GBPUSD price fell by around 120 pips from the day’s high, at 1.4507.
You can read the full article here.