Forex - GBP/USD gains on advancing U.K. construction report

The pound strengthened against the dollar on Monday after data revealed a pick-up in U.K. construction activity, while the dollar edged lower as markets prepped for the release of the October jobs report later this week.

In U.S. trading on Monday, GBP/USD was trading at 1.5954, up 0.17%, up from a session low of 1.5903 and off from a high of 1.5978.

Cable was likely to find support at 1.5894, the low from Oct. 16, and resistance at 1.6208, last Monday's high.

The pound advanced after data showed that the U.K. construction purchasing managers’ index rose to 59.4 last month, the highest level since September 2007, from 58.9 in September. 

Analysts were expecting an unchanged reading.

Meanwhile in the U.S., date released earlier revealed that U.S. factory orders rose 1.7% in October from September, in line with expectations.

The dollar traded lower, however, as investors weighed possible market reactions to the release of the October U.S. jobs report due out on Friday.

The dollar also moved lower as investors sold the unit for profits in wake of better-than-expected recent manufacturing data.

The Institute of Supply Management released data last week showing that the U.S. PMI rose to 56.4 in October from 56.2 in September, defying expectations for a decline to 55.0.
The numbers sent the greenback strengthening to levels ripe for profit taking on Monday.

The pound, meanwhile, was up against the euro and up against the yen, with EUR/GBP down 0.04% at 0.8468 and GBP/JPY up 0.15% at 157.43.

On Tuesday, the U.K. is to release private sector data on retail sales, an important economic indicator.

In the U.S., the Institute of Supply Management is to release a report on service-sector activity.