GBPUSD trading 0.42% higher for the third consecutive day supported by Conservative favourable polls. The latest survey from Kantar, shows that Conservatives lead over Labour increased by one point to 12%. Tories got 44% while Labour party captures 32%. The previous week poll by Kantar provided an 11% lead. The news is Pound-Sterling positive as a clear victory for Tories will open the way for a Brexit plan.
On the macro front the United Kingdom Markit Construction PMI registered at 45.3 topping expectations of 44.5 in November. Yesterday, the United Kingdom Manufacturing PMI came in at 48.9, topping forecasts of 48.3 in November.
U.S. ISM Manufacturing PMI Weigh on USD
In the USA the Redbook Index (month over month) increased to 0.4% on November 29 from previous -0.4%, while the yearly reading increased to 7.9% from last reading at 4.3%. US dollar was under intense selling pressure after the U.S. ISM Manufacturing PMI came in at 48.1 below market expectations of 49.2 in November, the ISM Prices Paid came in at 46.7, also below forecasts of 47 in November. The United States Construction Spending (month over month) registered at -0.8%, below market expectations of 0.4% in October.
GBPUSD trades close to daily high and makes fresh monthly highs as the short term outlook is bullish for the pair. GBPUSD needs a break above the daily high at 1.3009 resistance so more buyers can join the trend. Next hurdle to the upside stands at 1.3040 the high from May 12th.
On the other hand, the first support level for GBPUSD stands at 1.2929 daily low and then at 1.2806 the low from October 29th, before a move down to 1.2725 the 50-day moving average.
All in all, the bulls need to break convincingly above 1.30 in order to gain control and increase the probability of a leg higher; a rejection at that level might ignite profit-taking for one more time.
Going forward, investors must be cautious ahead of the general election on December 12, and the Brexit deadline in January.More content