On Thursday, at 12:30 GMT the publication of the United States Preliminary GDP and Unemployment Claims could impact the market via a move of the USD.
On Friday, the top event of the week will take place, as at 12:30 GMT the US Core Personal Consumption Expenditure Index monthly change will be published. If the data shows that inflation is not decreasing, the US Dollar is bound to surge. Higher than expected inflation is set to pressure the US Federal Reserve to hike the Dollar's base interest rate.
GBP/USD hourly chart analysis
If the 1.2700 level fails to hold, support could be looked for in the weekly S1 simple pivot point at 1.2687, before the pair aims at the lower trend line of the broad channel up pattern and the weekly S2 at 1.2638.A potential recovery of the Pound against the US Dollar is expected to face the 200-hour SMA and the weekly simple pivot point at 1.2725 as resistance. Higher above, the 100-hour SMA might slow down a surge, before the 50-hour SMA and the weekly R1 are reached near 1.2770.
Hourly Chart
GBP/USD daily candle chart analysis
The surge has reached the resistance of a long ago marked resistance zone. We investigated the range and found that certain levels act as resistance. Resistance is provided by the 1.2800, 1.2830, 1.2850 and 1.2900 levels. At these levels major reversals have happened that have started moves that lasted from a month up to a whole quarter.
The GBP/USD could be at a major turning point. Due to this reason watch the ascending channel closely for potential breaking of it and the establishment of a new pattern.
Read More: Technical Analysis
Traders are shorting
On Monday, traders were 75% short, as that proportion of all open position volume on Swiss Foreign Exchange was in bearish positions.
Meanwhile, pending orders in the 100-pip range around the rate were 62% to sell.
During Wednesday's trading, positions were 70% short, as some had closed during the surge, before the rate bounced off the 1.2800 mark. In the meantime, pending orders were 58% to buy.
Meanwhile, pending orders in the 100-pip range around the rate were 62% to sell.
During Wednesday's trading, positions were 70% short, as some had closed during the surge, before the rate bounced off the 1.2800 mark. In the meantime, pending orders were 58% to buy.