GBP/USD: Bulls target 1.3250 on UK manufacturing PMI?

The GBP/USD pair kicked-off the week on a positive note and hovered near ten-month tops of 1.3224 reached in the overnight trades, as markets eagerly await the release of the UK’s manufacturing PMI for the next leg higher.

GBP/USD: Focus shifts to PMIs

The bulls take a breather in the Asian session, allowing a brief phase of upside consolidation in the major, as the dust settles after yesterday’s volatile session, fuelled by heavy USD sell-off across the board.

The greenback fell to fresh 14-month lows against its main competitors on Monday, after renewed US political jitters gripped markets, following the announcement that the US President Trump removed Anthony Scaramucci from his job as communications director.  The USD index dropped to 92.64, the lowest levels since May 2016.

Moreover, the recent series of downbeat US fundamentals combined with the less hawkish Fed outcome also continue to cast a cloud of doubt on the US economy, adding to broad USD weakness.

Looking ahead, Cable could remain underpinned amid expectations of a better UK manufacturing PMI result, while broad based US dollar weakness could extend ahead of the US ISM manufacturing PMI data, which could help the rate take-out the next upside barrier located at 1.3250.

GBP/USD levels to consider             

At 1.3220, the pair eyes a test of 1.3250 (psychological levels/ Sep 16 high) and 1.3345 (Sep 12 high). On the downside, supports could be seen at 1.3100/1.3098 (psychological level/daily low), 1.3000 (Jul. 26 low) and 1.2950 (Jul. 21 low).