Bulls failed to utilize the positive UK construction PMI and weak US data. The cable rejected at 20Dsma extending its fall for the third consecutive day.
In June, construction sector output growth rebounded to its fastest rate in four months. June's readings signaled a further rebound in construction sector from a 22-month low recorded in April. The UK Construction PMI inched from 55.9 in May to 58.1 in June.
Today, traders eye the UK Services PMI, which fell to 56.5 from 59.50. Analysts' forecast was 57.4.
Technical view:
The cable rejected at 100Wema trading below 50Wsma 1.5650. The cable was trading at the 20Dsma 1.5660 and closed below that level. The support is found at 1.5540 on an intraday and weekly basis as well. Bulls tried to close above 1.5650. The 20Wsma is found at 1.5265. The strong support zone is found at 1.5540 and 1.5510. A daily close below these levels opens gates for 1.5460 and 1.5430, and even 1.5270. The previous swing low is seen at 1.5170.
In the H1 and the four-hour chart, the cable has been moving towards lower highs and lower lows. The cable was trading at 1.5610 at today's Asian session. We can observe bunch of supports for every 30 points. Safe selling is not available today. Trade depends on UK data amid absence of US data. Intraday support is found at 1.5580, 1.5540, and 1.5510. We recommend safe selling below 1.5500. Risk traders can sell with help of the given support levels. Intraday resistance is seen at 1.5640, 1.5670, and 1.5700. Small buying is available above 1.5675 towards 1.5700 and 1.5730 in the extreme case. The lower high formation will be erased above 1.5735.
