- 52% of pending orders in the 100-pip range are to BUY the Sterling (-12%)
- SWFX market sentiment is 66% bullish (+2%)
- Upcoming fundamental events: UK Current Account, Final GDP q/q and Net Lending to Individuals m/m; US Core PCE Price Index m/m, Personal Spending m/m, Chicago PMI and Revised UoM Inflation Expectations
The Pound's direction today should be determined by its ability to breach the 55-hour SMA at 1.3130.
The Greenback weakened against the European single currency, following the US Final GDP data release on Thursday. The EUR/USD currency pair gained seven pips, or 0.06%, to continue fluctuating in the 1.1592 area.
The Bureau of Economic Analysis released quarterly Gross Domestic Product data that came out lower-than-expected of 2.0%, and was also lower than the previous period.
According to Mario Blascak, the European Chief Analyst: "The largest positive contributions to GDP stem from non-residential fixed investment, personal consumption expenditures, and exports. The biggest drag in PCE, exports, state and local government spending, federal government spending and a downturn in residential fixed investment. "
British Current Account at 0830GMT
The only data release of importance today is the British Current Account published at 0830GMT. Analysts forecast a deficit of 18.0B during the first quarter of 2018. The UK Final GDP and Net Lending to Individuals are likewise published at the same time.
The United States will release several data sets later in the day, namely, the Core PCE Price Index and Personal Spending at 1230GMT. The Chicago PMI and Revised UoM Inflation Expectations are published at 1345GMT and 1400GMT, respectively.
GBP/USD hits channel line
The GBP/USD exchange rate showed no changes to its positioning on Thursday, thus trading near the monthly S1 and the bottom channel line circa 1.3080 for the whole session.Technical indicators on the 1H and 4H time-frames demonstrate that the Pound might accelerate from this channel today, thus breaching the 55-hour SMA at 1.3131 and approaching the massive resistance cluster formed by the 100– and 200-hour and 55-period (4H) SMAs near 1.32.
Given that this area has been historically significant resistance/support, a move above it is very unlikely. In case the bearish sentiment takes over the market today, it is expected that the Sterling moves lower along the bottom channel line towards the weekly S1 and a nine-month low of 1.3025.
Hourly chart
By reviewing the daily chart of the GBP/USD pair it was discovered that there exists a descending channel pattern that has been in action since the middle of April.
The pair breached this medium-term channel earlier this week, thus pointing to a possible surge towards the 55- and 200-day SMAs located near 1.3650.
Daily Chart
The bullish market sentiment of OANDA has increased significantly, as 70% of its traders are holding long positions (+11%). Saxo Bank clients are likewise bullish with 62% long positions (+2%). The market sentiment in this trading session has seen some recovery if compared to weaker bulls on Thursday.
Spreads (avg, pip) / Trading volume / Volatility