- 74% of pending orders in the 100-pip range are to SELL
- 56% of traders are bullish on the Pound (-4%)
- Nearest support is located circa 1.3250
- Upcoming events: US Empire State Manufacturing Index, US Federal Budget Balance
The Labour Department showed that the US Consumer Price Index edged 0.5% higher in September, the strongest gain since January, which put the yearly rate of consumer inflation to 2.2% in the reported period.
Separate report showed a 1.6% increase in the country's retail sales, where its sustainable firmness could cause a cease of low inflation trend and confirm the Fed's stance to raise interest rates anytime soon.
Lack of fundamentals on Monday
Only two sets of data that could influence GBP/USD are released on Monday both of which are of medium or low importance. The Federal Reserve Bank of New York is to publish its Empire State Manufacturing Index at 1230GMT. Meanwhile, the release of the US Federal Budget Balance is still tentative.
GBP/USD fails to surge above 1.3320
Although the US data release, in general, appeared to be worse than expected, the upside momentum was not strong enough to push the pair above the monthly PP at 1.3322.
The presence of a recently formed ascending channel whose bottom boundary is backed up by the rising 55-, 100-, 200-hour SMAs suggests that the currency rate most probably is going to break through that resistance and continue to move to the north.
On the other hand, there are two large unconfirmed channels who boundaries are located near the 1.3330 mark and that might turnaround the pair.
Finally, there is a need to take into account that this week will be full of the UK data releases, including inflation and retail sales, that are expected to have a notable impact on further direction of the pair.
Hourly chart
The upside momentum of the Sterling has allayed slightly below the monthly PP at 1.3322. The narrow candle apparent on Monday morning demonstrates either indecisiveness towards the pair or the equal force of bulls and bear that has managed to keep the rate stable.
By and large, the Pound is stranded between the monthly and weekly PPs at 1.3322 and 1.3224, respectively. Given the lack of fundamentals in this session, the rate might fail to demonstrate high volatility and thus remain in the given range.
Daily chart
Bullish market sentiment slightly weakens
The bullish SWFX market sentiment has decreased in this session, as the number of long positions is currently standing at 56%, compared to 60% on Friday. However, pending orders are at perfect equilibrium (-2%).
Market sentiment of OANDA traders remains bullish on the Pound, as 52% of open positions are long (-3%). Meanwhile, traders at Saxo Bank are still increasingly bearish with 63% short positions (+4%).