In general, the pair was expected to continue to decline, as it had to technical support as low as the 1.2594 level. Latest Fundamental Event Report
The British Pound traded sideways against the US Dollar, following the UK Current Account data release on Friday at 08:30 GMT. The GBP/USD exchange currency rate gained 7 pips or 0.06% right after the release. The British Pound continued trading at the 1.2685 level against the Greenback.
Office for National Statistics released the UK Current Account data, which came out better-than-expected of negative 30.0B compared with forecasted negative 32.0B.
According to the official release: "The UK financed its current account deficit mainly through other investment, where UK investors withdrew overseas deposits while overseas investors increased their deposits with UK monetary financial institutions."
US data in focus this week
On Wednesday, the ISM Non-Manufacturing PMI will be published at 14:00 GMT. The data release has caused moves from 11.8 to 22.6 pips on the GBP/USD charts.
For this pair the week will end with the US Employment data sets – the Average Earnings, Unemployment Rate and Non-Farm Employment Change.
On the GBP/USD charts this event has caused moves in a range from 14.8 to 27.7 pips since February.
GBP/USD short-term review
On Tuesday morning, the GBP/USD confirmed the resistance of the weekly S1 at 1.2648 by failing to break this technical level and bouncing off it.In general, the pair had no technical support as low as the 1.2694 level, where a weekly S2 is located at. The rate was expected to gradually reach this level in the near term future.
On the other hand, the rate could consolidate by trading sideways until the resistance of the hourly simple moving averages approaches it.
Hourly Chart
On the daily candle chart one can observe that the rate remains in the borders of a descending channel pattern. Namely, the rate is recovering in its borders.
Note that a possible surge of the rate might face the resistance of the 55-day simple moving average near 1.2800.
Daily chart
Since Friday, 64% of open position volume on the Swiss Foreign Exchange was in long positions.
The situation changed on Tuesday, as 72% of open position volume was in short positions.
Meanwhile, trader set up pending orders in the 100-pip range were bearish, as 72% of orders were set to sell. They had not changed since Friday.
In general, traders were long on the pair, but had close by take profits and stop losses.