Our trade call is to sell Cable on a Manufacturing PMI reading below 51. Both stop-loss and take-profit approximately equal the ADR of 140 pips, but both should be set above significant levels of support or resistance.
Current Market Sentiment:
The Asian session saw multiple high impact data points; Building Approvals from Australia missed estimates at -7.5% m/m vs-2.9% expected. The Aussie saw some downside post release, and the decline continued with both the Chinese government NBS release and the Markit/Caixinrelease for Manufacturing PMI missing estimates at 49 and 48 respectively.There was limited risk-off reaction to the miss as the market has now priced ina steady slowdown in Chinese manufacturing.
After declining 40 pips during the first half of the session, the Aussie then saw upside as the RBA statement failed to strike any new dovish tone and largely reiterated the prior statement. The Aussie rallied 50 pips post-release, also helped by gradual moves higher in WTI and Asia-Pacific indices marginally in the green.
Ahead we have the Purchasing Managers’Index for the UK’s Manufacturing sector.
P.S. This release was also covered in the weekly risk events video. You can watch it here.
At no time should anyone view the information presented anywhere on this website as advice, recommendation or proven. Everything reflected is merely opinion and may not be accurate. The purpose of the site is to express the opinions and views of Jarratt Davis. There is no intention to offer specific help, advice or suggestions to anyone reading any of the content posted here.
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