Yesterday’s trade saw GBP/USD within the range of 1.4453-1.4658. The pair closed at 1.4543, surging 0.70% compared to Mondays close. It has been the 23rd gain in the past 53 trading days and also the steepest one since May 24th, when the pair advanced 1.04%. The daily high has been the highest level since May 31st, when a high of 1.4724 was registered. The major pair has edged up 0.48% so far in June, following a 0.92% drop in the prior month.
At 6:27 GMT today GBP/USD was inching up 0.02% on the day to trade at 1.4546. The pair touched a daily high at 1.4560 during late Asian trade, undershooting the daily R1 level, and a daily low at 1.4531 during the early phase of the Asian trading session.
On Wednesday GBP/USD trading may be influenced by the following macroeconomic reports as listed below.
Fundamentals
United Kingdom
Manufacturing, Industrial Production Indexes
Annualized industrial production in the United Kingdom probably shrank for a third consecutive month in April, according to market expectations, at a pace of 0.4%. In March the index of industrial output contracted 0.2% year-on-year, or at a lesser rate than projected. In monthly terms, industrial production probably remained flat in April, according to expectations, following a 0.3% expansion in March. Within the index, the largest increase was observed in the gauge for utilities (up 3.3% month-over-month), while the gauge for manufacturing ticked up 0.1% and that for mining slipped 0.4%. The index of industrial output measures the change in the total inflation-adjusted value of production in sectors such as manufacturing, mining and utilities. Consistent rates of decrease in industrial production suggest weaker inflation pressure.
United Kingdom’s annualized manufacturing production, a short-term indicator which accounts for almost 80% of the nation’s industrial output, probably shrank 1.5% in April, according to the median forecast by analysts. If so, this would be the 10th consecutive month of contraction. In March manufacturing output fell at an annualized rate of 1.9%, or the steepest since May 2013. In monthly terms, manufacturing production probably rose 0.1% in April, according to the median estimate by experts, following another 0.1% increase in March. As it is a key component of the country’s Gross Domestic Product, in case annual manufacturing production shrank more than projected, this would have a moderate bearish effect on the Pound. The Office for National Statistics (ONS) will release the official industrial report at 8:30 GMT.
GDP estimate by the NIESR
At 14:00 GMT the National Institute of Economic and Social Research (NIESR) will release its estimate in regard to UK Gross Domestic Product over the three months to May. During the three-month period to April the NIESR estimate pointed to a 0.3% GDP growth, or matching projections for the prior two periods. The report is considered as highly reliable and usually heightens volatility of the pairs containing the Pound.
United States
Job Openings
The number of job openings in the United States probably decreased to 5.672 million in April from a month ago, according to the median forecast by experts. If so, this would be the lowest number of job openings since February, when a revised up 5.608 million positions were reported. In March a total of 5.757 million job openings were estimated, as the number of job openings waiting to be filled rose in professional and business services (+124 000), transportation, warehousing, and utilities (+35 000) and non-durable goods manufacturing (+29 000). At the same time, there were fewer job openings in retail trade (-80 000), educational services (-36 000) and wholesale trade (-35 000) during the same month.
This indicator refers to all job positions that are open, but not filled on the last business day of the month. Job openings are part of the Job Openings and Labor Turnover Survey (JOLTS), which gathers data from about 16 400 non-farm establishments including retailers and manufacturers, as well as federal, state, and local government entities in the 50 states and the District of Columbia. The survey assesses the unmet demand for labor in the labor market. A lower-than-projected level of job openings will usually have a limited bearish effect on the US dollar. The Bureau of Labor Statistics is to release the official report at 14:00 GMT.
Daily and Weekly Pivot Levels
By employing the Camarilla calculation method, the daily pivot levels for GBP/USD are presented as follows:
R1 – 1.4562
R2 – 1.4581
R3 (range resistance) – 1.4600
R4 (range breakout) – 1.4656
S1 – 1.4524
S2 – 1.4505
S3 (range support) – 1.4487
S4 (range breakout) – 1.4430
By using the traditional method of calculation, the weekly pivot levels for GBP/USD are presented as follows:
Central Pivot Point – 1.4543
R1 – 1.4701
R2 – 1.4883
R3 – 1.5041
S1 – 1.4361
S2 – 1.4203
S3 – 1.4021
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