Pound/Dollar flirts in resistance area, focus on construction PMI today

After Superb performance of Manufacturing PMI, focus is on another key GDP pillar, construction for further cues. UK construction PMI report for October to be released at 9:30 GMT. Marginal softening is expected.

• After strong showing since 2013. Construction PMI reached as high as 60.1 in February this year. After which performance dropped sharply to as low as 54.2 by April. While some expected persistent weakness in the sector, post - February weakness now seems to be winter and first quarter phenomenon.
• Since April, PMI has risen steadily to reach 59.9 in September.
• However, marginal slowdown is expected today to 58.8 for October.

Pound is flirting around key resistance level of 1.55 against Dollar. After yesterday's manufacturing PMI, Pound tested the level but finally failed and dropped more than 80 pips by closing in New York.

Today could be another test of the level, if construction PMI surprise to the upside. However, with bears still hovering large and Bank of England's (BOE) scheduled for tomorrow, there could be limited gains.

Technically speaking, Pound is hovering at key resistance against Dollar and it is close to upper band of a downward sloping channel as shown in figure.