GBP/USD in a tight range near 1.2300 ahead of PMI

The Sterling is posting decent gains vs. the greenback on Tuesday, taking GBP/USD to the 1.2300 neighbourhood at the end of the Asian session.

GBP/USD now looks to PMI

Spot has managed to clinch session highs near 1.2310 during overnight trade, easing some pips soon afterwards against a backdrop of quite a solid performance by the US dollar.

In the meantime, the pair continues to look for a clearer direction after finding good support around 1.2200 the figure during last week amidst scarce volatility and usual conditions of year-end trading.

On the positioning side, GBP net shorts have been trimmed to the lowest level since early July during the week ended on December 27 according to the latest CFTC report, which can somewhat help Cable to limit the downside.

Data wise in the UK, December’s Manufacturing PMI is expected to have eased to 53.0 from 53.4, while US ISM Manufacturing and Markit’s Manufacturing PMI are seen on the stronger side during the same period.

GBP/USD levels to consider

As of writing the pair is advancing 0.20% at 1.2300 and a break above 1.2389 (high Dec.30) would open the door to 1.2415 (55-day sma) and finally 1.2648 (100-day sma). On the other hand, the immediate support aligns at 1.2280 (low Dec.29) ahead of 1.2112 (low Oct.28) and then 1.2081 (low Oct.25).