GBP/USD, EUR/GBP, USD/CAD – North American Session Daily ForecastThe markets are sluggish on Monday, despite the extra of hour sleep on the weekend. The Canadian dollar and EUR/GBP are almost unchanged, and GBP/USD is slightly lower after another weak British Construction PMI release.
GBP/USD has started the week with slight gains. In Monday’s North American session, the pair is trading at 1.2906, down 0.24% on the day.
British Construction CPI Remains Weak
British Construction PMI continues to languish in negative territory. The index improved slightly in October, with a reading of 44.2, which was within expectations. Still, the index is pointing to a sustained decline in construction, with six straight readings below the 50 level. These weak readings are likely to continue. We’ll get a look at the Services PMI on Tuesday.
After drifting late last week, GBP/USD is showing some downward movement on Monday. Still, the pair remains range-bound. The pair is putting pressure on resistance at 1.2940, which was tested last week. On the downside, we find support at 1.2870.
USD/CAD is flat in the North American session. In Monday’s North American session, the pair is trading at 1.3138, down 0.03%. Canada will release trade balance on Tuesday, so we could see stronger movement in Tuesday’s North American session.
USD/CAD has started the week with little movement and is currently range-bound. The pair had a busy Friday and tested resistance at the 1.3200 line, before retracting. On the downside, there is immediate support at 1.3120, and this line is vulnerable to a breakout. Traders should also note that the pair briefly broke above the 50-EMA on Friday, before retreating. Currently, the 50-EMA is at 1.3187. If USD/CAD can push above this line, it would be a bullish signal and I would expect to see buyers.
EUR/GBP has been drifting since late October and there has been no change in the Monday session. In the North American session, the pair is trading at 0.8638, up 0.08% on the day.
There were no surprises from European manufacturing PMIs, all of which were within expectations. The German indicator came in at 42.1, indicative of deep contraction in the manufacturing sector.
EUR/GBP remains range-bound. The pair has flirted with resistance at 0.8647 since mid-October, but this line has proven to be resilient. After a prolonged period marked by a lack of a trend, a breakout is a distinct possibility this week. I expect the pair to continue to test the 0.8647 line. On the downside, the support level of 0.8580 remains vulnerable.