The GBP/USD ended trading in a triangle pattern by breaking out downwards. By the middle of Monday's GMT trading, the currency exchange rate had declined below the 1.3500 mark.
By declining below the 1.3500 level, the rate had passed the last technical support. Namely, the most close by technical support was the weekly S2 simple pivot point at 1.3433.
Economic Calendar
During the week there will be minor data sets published, which could cause initial reactions of up to 20 pips. Traders with close by tight stop losses should take into account the times of the macroeconomic data releases.
On Wednesday, the United States Bureau of Labor Statistics is set to publish the Consumer Price Index and Core Price Index at 13:30 GMT.
Afterwards, at 13:30 GMT, expect the weekly US Unemployment Claims. Despite the attention this release gets, we do not recommend monitoring it closely, as the last two releases caused moves below ten base points on the GBP/USD.
The week will end with the publication of the US Retail Sales and US Core Retail Sales at 13:30 GMT. In November and December, these data sets caused an increase of volatility above the average.
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
It is likely that some downside potential could continue to prevail in the market within the following trading session. Note that the currency pair could gain support from the weekly S2 at 1.3433.Meanwhile, it is unlikely that bulls could prevail in the market and the exchange rate could exceed the 1.3560/1.3605 area due to the resistance formed by the 55-, 100– and 200-hour SMAs, as well the weekly PP.
Hourly Chart
On the daily candle chart, the pair has bounced off the resistance of the channel up pattern, which has guided the rate since September.
In regards to the future, due to the angle of the resistance line, the rate still has room for a surge. However, a decline to the 55- day SMA is likely, as the rate had done so each time after reaching the upper trend line.
Daily chart
Read More: Technical Analysis
Traders set up buy orders
Since Friday, 63% of trader open position volume on the Swiss Foreign Exchange was in short positions.
Meanwhile, in the 100-pip range around the rate the pending orders were 76% to buy the GBP/USD pair. Previously, the orders were 54% to sell.
Since Friday, 63% of trader open position volume on the Swiss Foreign Exchange was in short positions.
Meanwhile, in the 100-pip range around the rate the pending orders were 76% to buy the GBP/USD pair. Previously, the orders were 54% to sell.