US100 – London Session Outlook

Trading Focus
The marked zones on the chart highlight areas where I look for small but quick intraday moves. There are two potential sell zones and two potential buy zones. If a zone breaks, I look for continuation trades on a retest of that same level.
This approach allows me to capture short, tactical opportunities with clear risk levels, while adapting quickly if price breaks structure.

Macro Update – Manufacturing Still Under Pressure
Yesterday, the ISM Manufacturing PMI was released. The August figure came in at 48.7%, a slight improvement from July’s 48.0%, yet still below the 50% threshold that signals expansion. This indicates that U.S. manufacturing remains in contraction for the sixth consecutive month, though the slower pace points to some early signs of stabilization. New orders climbed back above 50%, suggesting demand may be recovering, but production and employment both weakened, and prices remained elevated, underscoring persistent cost pressures. Overall, the sector is still under strain, showing only tentative signs of recovery.

Market Sentiment
Overall, market sentiment is cautious. The rebound in new orders provides a hint of optimism, but weak production, soft labor data, and sticky input costs keep investors on edge. Traders remain defensive, seeking confirmation before committing risk in what is still a fragile backdrop.

What’s Next – JOLTS Job Openings
Today, all eyes are on the JOLTS Job Openings report, a key gauge of U.S. labor market strength.

• A higher reading signals tight labor conditions, keeping wage and inflation pressures high and limiting the Fed’s ability to cut rates.
  
• A weaker reading suggests cooling demand for workers, supporting the case for easing.
  

This release has the potential to move markets quickly, adding another layer of volatility.