At mid-day on Wednesday, the GBP/USD broke the resistance of the 1.3700 level. However, it did not result in a sudden sharp surge, as the rate was slowed down by the resistance of the weekly R1 simple pivot point at 1.3717.
The near term future was based upon whether the weekly R1 provides enough resistance to keep the rate down.
Economic Calendar
On Thursday, at 13:30 GMT, a minor move could be caused by the weekly US Unemployment Claims. This event has caused GBP/USD moves from 8.8 to 45.7 pips since December 17.
However, note that the 45.7 pip move in December 23 was an anomaly caused by other events not the Unemployment Claims. Without the 45.7 pips move, the range is 8.8 to 12.7 pips.
On Friday morning, at 07:00 GMT the UK Retail Sales could cause a move from 6.4 to 16.0 base points.
On the same day at 09:30 GMT, the UK Manufacturing and Services PMIs could cause a move from 13.0 to 18.7 pips.
The Friday will end with the US Manufacturing and Services PMIs at 14:45 GMT. The GBP/USD has moved from 7.8 to 35.5 pips on the release.
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
If the weekly R1 at 1.3717 holds, it is likely that the currency pair could bounce off in the nearest future to the support area formed by the 55-, 100– and 200-hour SMAs, as well the weekly PP in the 1.3584/1.3622 range.In the meantime, it is unlikely that some upside potential could continue to prevail in the market in the short run due to the resistance provided by the weekly R1 and the upper line of the rising wedge pattern in the 1.3720 area.
Hourly Chart
On the daily candle chart, it can be observed that previously the 1.3700 level strengthened the resistance of the large scale channel up pattern.
In regards to the future, due to the angle of the resistance of the pattern, 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
Short sentiment grows
On Wednesday, 69% of trader open position volume on the Swiss Foreign Exchange was in short positions.
On Tuesday, the sentiment was 65% short.
Meanwhile, in the 100-pip range around the rate the pending orders were 79% to sell the GBP/USD pair. Previously, the orders were 60% to sell.
On Wednesday, 69% of trader open position volume on the Swiss Foreign Exchange was in short positions.
On Tuesday, the sentiment was 65% short.
Meanwhile, in the 100-pip range around the rate the pending orders were 79% to sell the GBP/USD pair. Previously, the orders were 60% to sell.