The GBP/USD on Monday continued the decline, which began on Friday. During the morning London trading hours the rate had reached the support of the 200-hour simple moving average.
If the rate would pass this support, the decline could soon reach the 1.2400 level.
Economic Calendar
Next week on Thursday, the US Final GDP will be published at 12:30 GMT. This event has caused moves on the GBP/USD from 8.1 to 52.00 pips since June 2018.
Note that during the last two releases the pair moved the least and the most 8.1 and 52.0 pips.
The week will end with the US Durable Goods Orders data release at 12:30 GMT. The event will consist of the release of US Durable Goods Orders and US Core Durable Goods Orders.
This event has caused almost insignificant moves since April, as the GBP/USD moved from 6.5 to 15.1 pips. Due to that it is concluded that this event that is tagged as high impact on economic calendars, is not notable enough to be watched.
GBP/USD short-term review
At the end of last week, the GBP/USD exchange rate traded above the 1.2480 level. During Monday morning, the rate was testing the support formed by the 200-hour SMA at 1.2437.If the given moving average does not hold, it is likely that the British Pound could depreciate against the Greenback. Note, that the rate could be supported by the weekly S1 located at the 1.2392 mark. If the given support does not hold, the rate could decline to the 1.2350 level.
It is unlikely, that some upside potential could prevail in the market within the following trading session, as the currency pair is pressured by the 55- and 100-hour moving averages, as well the weekly PP located circa 1.2490.
Hourly Chart
On the daily candle chart, the rate is bouncing around the 100-day simple moving average, which is located at the 1.2487 level.
Take into account that this level is from time to time providing both support and resistance.
Daily chart
Read More: Technical Analysis
Short sentiment remains unchanged
Since the middle of Wednesday's London trading session, 60% of open GBP/USD position volume on the Swiss Foreign Exchange was in short positions.
Traders are sitting on their short position and riding the wave down.
Meanwhile, trader set up pending orders in the 100-pip range had changed. Previously, 77% of trader orders were to sell. By the middle of Monday's trading 66% of orders were to buy and 34% were to sell.
It was assumed that the change in orders was due to the rate declining down. Namely, stop losses had been moved closer and take profits were also close by.
In addition, some buy to open long orders should be set up in the expectations of a retracement after the recent decline.
Since the middle of Wednesday's London trading session, 60% of open GBP/USD position volume on the Swiss Foreign Exchange was in short positions.
Traders are sitting on their short position and riding the wave down.
Meanwhile, trader set up pending orders in the 100-pip range had changed. Previously, 77% of trader orders were to sell. By the middle of Monday's trading 66% of orders were to buy and 34% were to sell.
It was assumed that the change in orders was due to the rate declining down. Namely, stop losses had been moved closer and take profits were also close by.
In addition, some buy to open long orders should be set up in the expectations of a retracement after the recent decline.