Yesterdays trade saw GBP/USD within the range of 1.3902-1.4019. The pair closed at 1.3960, rising 0.32% on a daily basis. It has been the 16th gain in the past 42 trading days and also a second consecutive one. The daily high has been the highest level since February 26th, when a high of 1.4045 was registered.
At 7:21 GMT today GBP/USD was inching down 0.01% for the day to trade at 1.3958. The pair touched a daily high at 1.3979 at 6:59 GMT, undershooting the daily R2 level, and a daily low at 1.3944 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
Construction PMI by Markit/CIPS
Activity in United Kingdom’s sector of construction probably increased at a faster pace in February from a month ago, with the corresponding Purchasing Managers Index coming in at 55.5, up from a reading of 55.0 in January. If so, February would be the 34th consecutive month, when the gauge inhabited the area above 50.0. The index is based on a survey, encompassing managers of companies, operating in the construction sector. They are asked about their estimate regarding current business conditions (new orders, output, employment, demand in the future). Values above the key level of 50.0 signify predominant optimism in regard to business conditions. In case the PMI accelerated more than anticipated in February, this would have a limited-to-moderate bullish effect on the sterling. The Chartered Institute of Purchasing and Supply (CIPS) is to release the official index reading at 9:30 GMT.
United States
Change in Employment by ADP
Employers in the US non-farm private sector probably added 185 000 new jobs during February, according to the median estimate by experts, following 205 000 new positions added in January. If expectations were met, this would be the slowest gain in jobs since October 2015, when 182 000 positions were added. The employment report by Automated Data Processing Inc. (ADP) is based on data that encompasses 400 000 – 500 000 companies employing over 24 million people, working in the 19 major sectors of the economy. The ADP employment change indicator is calculated in accordance with the same methodology, which the Bureau of Labor Statistics (BLS) uses. Published two days ahead of the governments employment statistics, this report is used by traders as a reliable predictor of the official non-farm payrolls data. Creation of jobs has a direct link to consumer spending, while the latter is a major driving force behind the US economic growth. However, in case new jobs growth came below expectations, this would have a moderate-to-strong bearish effect on the US dollar. The official figure is scheduled to be released at 13:15 GMT.
”Beige Book” report
At 19:00 GMT the Federal Reserve is to release its ”Beige Book” report. It is published eight times during the year. Each of the banks in the 12 Federal Reserve Districts gathers data in regard to current economic situation in the country on the basis of interviews with key business contacts, economists, market experts, and other sources. In case the Beige Book presents an optimistic economic outlook, this will usually support the greenback, while a pessimistic view will have a bearish effect on the currency.
Daily and Weekly Pivot Levels
By employing the Camarilla calculation method, the daily pivot levels for GBP/USD are presented as follows:
R1 – 1.3971
R2 – 1.3982
R3 (range resistance) – 1.3992
R4 (range breakout) – 1.4024
S1 – 1.3949
S2 – 1.3939
S3 (range support) – 1.3928
S4 (range breakout) – 1.3896
By using the traditional method of calculation, the weekly pivot levels for GBP/USD are presented as follows:
Central Pivot Point – 1.4014
R1 – 1.4177
R2 – 1.4483
R3 – 1.4646
S1 – 1.3708
S2 – 1.3545
S3 – 1.3239
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