On Friday morning, the GBP/USD made another attempt to pass the resistance line of a large scale descending pattern, and it failed at it.
This event was followed by a decline, which by the middle of the day was aiming at a technical support cluster at 1.2645.
The British Pound depreciated against the US Dollar, following the UK Monetary Policy Summary and Official Bank Rate data releases on Thursday at 11:00 GMT. The GBP/CAD exchange currency rate lost 29 pips or 0.23% right after the release. The British Pound continued trading at the 1.2690 level against the Greenback.
The Bank of England released the UK Monetary Policy Summary data, where the UK policymakers provided in-depth insights into the economic and financial conditions that influenced their vote on maintaining the Official Bank Rate unchanged. Note, that MPC Official Bank Rate Votes data was published at the same time.
According to the official release: "The Committee continues to judge that, were the economy to develop broadly in line with its May Inflation Report projections that included an assumption of a smooth Brexit, an ongoing tightening of monetary policy over the forecast period, at a gradual pace and to a limited extent, would be appropriate to return inflation sustainably to the 2% target at a conventional horizon. The MPC judges at this meeting that the existing stance of monetary policy is appropriate."
Notable data only next week
There are no more significant to the GDP/USD events scheduled for this week.
Next week, there will be a couple of notable events that might impact the GBP/USD through the value changes of both GBP and USD.
The data that is noted by the financial markets as important starts on Wednesday. On that day, the US Durable Goods Orders and Core Durable Goods Orders will be published at 12:30 GMT.
This event since February has caused moves from 9.0 to 20.5 pips. Note that the 20.5 pip was an anomaly, as the rest of the events have caused from 9.0 to 15.1 pips.
On Thursday, the US Final GDP will be published at 12:30 GMT. This is the least important GDP of the three quarterly publications of the US GDP. Since March 2018 this event has caused moves from 12.0 pips to 52.0 pips.
On Friday, the UK will have data, as the UK Current Account will be announced at 08:30 GMT. This event has caused moves from 11.5 pips to 44.3 since March of 2018.
The full review of all of the notable events of next week will be conducted in a video and published on our Dukascopy Webinars YouTube channel.
GBP/USD short-term review
During the previous trading session, the GBP/USD exchange rate tried to breach the medium-term descending channel north.From a theoretical point of view, it is expected, that the rate could reverse south and go downwards. However, note, that the currency pair could be supported by the 55-, 100– and 200-hour SMAs, as well the weekly PP in the 1.2613/1.2663 range.
If the given channel does not hold, a breakout north could occur in the nearest future. In this case, a possible upside target is the resistance level located at the 1.2760 mark.
Hourly Chart
On the daily candle chart one can observe that the rate is oversold, as the daily simple moving averages were located far above the current currency exchange rate.
Meanwhile, the pair still remains in a large scale descending channel pattern.
Daily chart
On Thursday, 72% of GBP/USD open position volume on the Swiss Foreign Exchange was in long positions.
By the middle of Friday's trading the sentiment was 70% long. Some traders had taken profits.
Meanwhile, trader set up pending orders in the 100-pip range were mostly set to sell, as 77% of orders were set to sell.
Most likely these orders are the stop losses of the long positions and short position open orders that would take advantage of a decline.