4:30am (NY Time) UK Manufacturing PMI Forecast 50.2 Previous 49.7
ACTION: GBP/USD BUY 52.2 SELL 48.00
“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.”
As the pre-market sentiment at the time of writing this post, market is expecting to see this number to stay above 50, and as such there shouldn´t be much market reaction; however, if this number falls below 50, GBP could be under some selling pressure as the confidence level for Sterling has been rather low among traders.
If our BUY/SELL numbers are hit, we can expect GBP/USD to move 50 pips within the hour.
We are looking for a difference or deviation of 2.0 minimum, and remember that this is a leading indicator and its impact may affect the upcoming trend of this currency for the weeks to come, or at least for the month of October.
As usual, I’ll be trading this release live and then post back the results as soon as I can. With releases such as the PMI’s, there are usually a lot of expectations from speculators, therefore they usually make excellent news events to trade.
UPDATE: No trade on this one as the release didn’t hit our deviation. Market proved to be seesawing afterwards, therefore the no trade decision was justified.