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COZfx: GBP/USD remains near 6-year highs, UK data still supp

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COZfx: GBP/USD remains near 6-year highs, UK data still supp

Postby dwang » Wed Jul 02, 2014 2:05 am

COZforex: The pound remained close to 6 years highs against the US dollar on Tuesday, after disappointing US data as demand for sterling strengthened broadly after data showed that growth in the UK’s manufacturing sector accelerated more quickly than expected in June.

GBP/USD hit 1.7155 amid US morning trade, the pair's highest since October 2008; the pair subsequently consolidated at 1.7152, gaining 0.27%. COZFX strategist Nigel Boynton said, GBP/USD is predicted to find support at 1.7038, and a decline through could take it to the next support line of 1.6969. Meanwhile, the pair is predicted to find its first resistance at 1.7146, and a rise through could take it to the next resistance line of 1.7185.

The Institute for Supply Management said its index of purchasing managers dropped to 55.3 last month from a reading of 55.4 in May. Analysts had expected the manufacturing PMI to increase to 55.8 in June.

Earlier Tuesday, Markit said the UK manufacturing purchasing managers’ index rise to 57.5 last month, up from 57.0 in May. Analysts had expected the index to tick down to 56.8.

The report said new orders continued to increase on the back of stronger domestic and export demand. Meanwhile, jobs creation in the sector rise to its highest in 39 months, led by increases in small firms.

The report indicated that the UK economy continued to grow at a strong pace in the second quarter, fuelling expectations that the deepening recovery will prompt the Bank of England to raise interest rates before the end of this year.

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