Sample Category Title

Our pivot (invalidation) point is at 1.1547.

Our preference rebound towards 1.1593. Alternative scenario Below 1.1547, expect 1.1531 and 1.1522.

Comment The RSI is below 50. The MACD is above its signal line and negative. The configuration is mixed. Moreover, the pair is trading under both its 20 and 50 MAs (respectively at 1.1562 and 1.1568).

Pivot (invalidation): 0.8855

Our preference Short positions below 0.8855 with targets at 0.8830 & 0.8815 in extension.

Alternative scenario Above 0.8855 look for further upside with 0.8870 & 0.8890 as targets.

Comment As Long as 0.8855 is resistance, look for choppy price action with a bearish bias.

UK PMI manufacturing rose 0.1 to 54.4 in June, above expectation of 53.5. Markit noted that output growth slowed from May's give month high. Meanwhile, input cost inflation picked up, leading to increased selling prices.

Rob Dobson, Director at IHS Markit, which compiles the survey:

"The UK manufacturing sector ended the second quarter on a subdued footing. The turnaround in performance since the start the year has been remarkable, with impressive growth rates late last year turning into some of the weakest rates of expansion seen over the past two years in recent months.

"The slowdown in new order growth since earlier in the year has also left manufacturers increasingly reliant on backlogs of work and inventory building to maintain higher output. This is a position that cannot be sustained far beyond the immediate horizon. The trend in demand will need to stage a much firmer rebound if a further slowdown in output growth is to be avoided.

"How likely such a revival is remains in some doubt, with the June survey also seeing business optimism drop to a seven-month low amid rising concerns about possible trade tariffs, the exchange rate and Brexit uncertainty. Ongoing supply-chain disruptions, including raw material shortages, and signs of a renewed upswing in input price inflation may also jeopardise stronger manufacturing growth. With industry potentially stuck in the doldrums, the UK economy will need to look to other sectors if GDP growth is to match expectations in the latter half of the year."

Full UK PMI Manufacturing release.

Pivot (invalidation): 0.7410

Our preference Short positions below 0.7410 with targets at 0.7365 & 0.7350 in extension.

Alternative scenario Above 0.7410 look for further upside with 0.7430 & 0.7445 as targets.

Comment The RSI shows downside momentum.

Pivot (invalidation): 1.3200

Our preference Short positions below 1.3200 with targets at 1.3125 & 1.3070 in extension.

Alternative scenario Above 1.3200 look for further upside with 1.3240 & 1.3270 as targets.

Comment Even though a continuation of the technical rebound cannot be ruled out, its extent should be limited.

Pivot (invalidation): 0.9930

Our preference Short positions below 0.9930 with targets at 0.9885 & 0.9855 in extension.

Alternative scenario Above 0.9930 look for further upside with 0.9955 & 0.9985 as targets.

Comment Intraday technical indicators are mixed and call for caution.

Eurozone PMI manufacturing was finalized at 54.9, revised down from 55.0. That's also an 18-month low. Markit noted that growth of output and new orders slowed further as upturn in new export business remains subdued. Also, supply chain pressure and rising oil prices took input cost inflation to four-month high.

Among the countries, the Netherlands stayed strong at 60.1 even hitting 6-month low. Ireland hit 5-month high at 56.6. Italy rebounded and hit 2-month high at 53.3. France deteriorated to 16-month low at 52.5.

Commenting on the final Manufacturing PMI data, Chris Williamson, Chief Business Economist at IHS Markit said:

"Eurozone manufacturing reported its weakest expansion for one-and-a-half years in June, with risks clearly tilted towards output growth waning further in coming months.

"Production growth has weakened markedly since the end of last year, and new order inflows have slowed even more. Manufacturers may therefore need to rein-in their production further to adjust to the recent downturn in order book growth unless demand revives.

"The biggest concern is the extent to which export order book growth has cooled since the start of the year, and could soon go into decline. The survey reveals mounting worries from companies relating to the impact of tariffs and trade wars, suggesting firms are bracing themselves for the potential for further export losses. Not surprisingly, business expectations for future production deteriorated in June to the lowest November 2015.

"At the same time there are signs that political uncertainty is also dampening business spirits, most evidently in Italy, which was consequently the second-worst performer of all countries surveyed in June ahead of France."

Full Eurozone PMI Manufacturing release.

Germany PMI manufacturing was finalized at 55.9 in June, unrevised. Markit noted that new orders exhibited slowest rise in over two years. Optimism towards future output also dipped to lowest for more than three years. But there was pick-up in rate of job creation.

Commenting on the final IHS Markit/BME Germany Manufacturing PMI® survey data, Phil Smith, Principal Economist at IHS Markit said:

"The rate of growth of Germany's manufacturing sector has consistently slowed throughout the first half of 2018, with June's final headline PMI reading the lowest seen for one-and-a-half years.

"The question is whether there is worse still to come. Order book growth has consistently been below that of output in recent months, and in June the gap widened as the former slowed to the weakest seen for over two years, suggesting some underlying downward pressure on output levels. Firms have indeed become less optimistic in their expectations towards output, with tariffs seen as an added headwind to growth in the months ahead.

"The sector's overall pace of growth may have shifted down another gear, but that hasn't stopped manufacturers from creating more and more jobs, with a pick-up in the rate of employment growth the one bright spot from June's survey. A strengthening domestic market will go some way towards offsetting the loss of exports."

Full Germany PMI manufacturing release.

France PMI manufacturing was revised lower to 52.3, down from 53.1, in June. Markit noted slower rates of output and new business growth in France. Though, pace of job creation was resilient. Input cost inflation also reached four-month high.

Tim Moore, Associate Director at IHS Markit, which compiles the France Manufacturing PMI® survey, said:

"June data revealed that manufacturing growth continued to lose momentum in France, with overall business conditions improving at the slowest pace for almost a year-and-a-half. It seems that the source of the slowdown in production growth has shifted from capacity constraints and supply chain bottlenecks to a general soft patch for new order books. Export sales increased only marginally in June, which contributed to the weakest upturn in total new work since the autumn of 2016.

"Most worryingly, the latest slowdown in new business growth was accompanied by a sharp and accelerated rise in manufacturing input costs. Survey respondents widely commented on increased prices for steel and aluminium. Operating margins remained under pressure, although the rate of output price inflation picked up from the eight-month low seen in May."

Full France PMI Manfacturing release.

Italy manufacturing PMI rose to 53.3 in June, up from 52.7 and beat expectation of 52.6. Markit noted there are pick-ups in both output and new order book gains. Meanwhile, input costs rise on back of higher steel prices. Jobs also added again but business confidence dropped to lowest in over five years.

Paul Smith, Economics Director at IHS Markit which compiles the Italy Manufacturing PMI® survey, said:

"Italy's manufacturing sector arrested its recent growth slide during June, registering faster upturns in both output and new orders.

"The improvements in growth to broad trend rates will raise hopes that the sector will now settle into a steady expansionary rate following the sharp slowdown in sector performance seen since the start of the year.

"Whilst manufacturers seem confident enough that growth will be sustained, with jobs continuing to be added at a decent clip in June, downside risks persist. Optimism in the outlook has deteriorated to its lowest in over five years and cost pressures are mounting, with steel prices especially reported to have risen during June."

Full Italy PMI Manufacturing release.