As any other USD currency exchange rate, the GBP/USD started a sharp decline at midnight, as the US Presidential Election polls closed. The decline reached the 1.2920 level, from where a recovery started.
By the middle of Wednesday's GMT trading hours, the rate had reached the 1.3000 level.
Economic Calendar
On the day after the US Election, on Wednesday, the US ISM Non-Manufacturing PMI will be published at 15:00 GMT.
At mid-day on Thursday the Bank of England is set to make a rate announcement. Most likely the bank would reach to the impact of the US election to the GBP/USD currency exchange rate and the recent rise in coronavirus cases.
On Thursday, expect the weekly US Unemployment Claims to cause a minor move at 13:30 GMT. Throughout October, the event has caused GBP/USD moves from 9.6 to 22.3.
Later in the day, at 19:00 GMT, the US Federal Reserve will make a Rate Statement. Namely, the bank will react to the US Election and the following market reaction. Previously, the Fed had stated that they intend to stop a market crash, if one starts due to the election results.
On Friday, the US are publishing their monthly employment statistics. Among them will be the Average Earnings, Unemployment Rate and official Non-Farm Employment Change. In general, the Average Earnings and Employment Change reveal, how much USD is used for employment.
The currency exchange rate has moved from 18.5 to 43.0 pips on the announcement since June.
Click on the link below to find out more about the data releases of this and other currency exchange rates.
GBP/USD short-term review
At mid-day on Wednesday, the GBP/USD currency exchange rate passed the resistance of the 200-hour simple moving average. Moreover, the SMA began to provide support to the pair.In addition, the rate had no technical resistance as high as the 1.3050 mark. Due to that reason, the rate was expected to reach for this level. In addition, the pair could be supported by the approaching 55 and 100-hour simple moving averages.
Meanwhile, take into account that a surprise announcement of the US Election results could cause a sharp move that would ignore all of the technical indicators.
Hourly Chart
On the daily candle chart, the rate had the support of the 100-day simple moving average at the 1.2990 level. This level provided the rate with support since the second part of September.
In the meantime, note that the 55-day simple moving average failed to provide resistance at the 1.3000 mark.
Daily chart
Read More: Technical Analysis
Traders become neutral
On Wednesday, 51% of trader open position volume on the Swiss Foreign Exchange was in long positions.
During Tuesday's GMT trading hours, the sentiment was 55% long. Traders had closed long positions.
Meanwhile, in the 100-pip range around the rate the pending orders were 81% to sell the GBP/USD pair.
On Tuesday, 83% of orders were to sell. These orders had been executed, as the long positions took profits.
On Wednesday, 51% of trader open position volume on the Swiss Foreign Exchange was in long positions.
During Tuesday's GMT trading hours, the sentiment was 55% long. Traders had closed long positions.
Meanwhile, in the 100-pip range around the rate the pending orders were 81% to sell the GBP/USD pair.
On Tuesday, 83% of orders were to sell. These orders had been executed, as the long positions took profits.