Soft UK Manufacturing PMI pressures the Sterling

Sterling bears were installed with inspiration following Tuesday’s soft UK manufacturing PMI of 52.7 which signaled a slowdown in Britain’s manufacturing sector in the month of November. The GBP weakened across the board as today’s data added to renewed concerns over the potential slowdown in economic momentum in the UK economy. Whilst the pound continues to face punishment from the Bank of England’s clear reluctance to begin raising UK interest rates, the stagnant inflation growth which has diluted some pressure on the central bank to act has weighed heavily on investor sentiment.

The GBPUSD remains threatened due to the resumption of USD strength and with investor attraction towards the pound likely to be reduced due to the latest news that the UK Prime Minister has called for a parliamentary vote on Wednesday for airstrikes in Syria, the promoted risk-off environment should encourage sellers to attack the GBPUSD with prices declining down towards the 1.49 support.

EURUSD revs ahead of ECB meeting

The EURUSD continues to be pressured by the growing divergence in both monetary policy and economic sentiment between the United States and Europe, with the pair currently hovering above the eight- month low at 1.0565. Sellers have been invited to attack the Eurodollar with intensity and if the ECB does ease monetary policy further in a couple of days, there exists a possibility of the pair facing parity before the start of 2016. With expectations escalating around the ECB easing monetary policy further in December, this has obstructed any possible recovery in the Eurodollar even after a heavy month of declines. The EURUSD is heavily bearish and with little signs of a bounce back may decline further towards the 12 year low around 1.0461.

GOLD remains under pressure

Gold plummeted almost 2% on Friday to a near six-year low at $1052 before bouncing back to the weekly highs of 1074.60 in Tuesday’s trading session. The precious metal continually faces pressures from the swelling expectations around the possibility of a US interest rate hike in December whilst dollar appreciation has encouraged sellers to aggressively send prices lower. With Gold being fundamentally bearish and completely dictated by US interest rate expectations, further Dollar strength may trigger the potential foranother decline towards $1050. There even exists a possibility that this relief rally may conclude below the previous support around $1080 which may act as a dynamic resistance to encourage sellers to bring prices back down.

NZDUSD

The NZDUSD may be in the process of turning technically bullish on the daily timeframe. Prices are trading above the daily 20 SMA and the MACD is about to cross to the upside. Prices may incline to the next relevant level based at 0.6750.

USDZAR

This pair is technically bullish on the daily timeframe. Prices are trading above the daily 20 SMA and the MACD has crossed to the upside. A breakout above the 14.50 level may open a path to the next relevant level at 14.60.