Despite previous expectations and historical data showing the opposite, the GBP was impacted by Markit UK Purchasing Manager's Indices. The data revealed that the UK firms are even more pessimistic than it was previously thought.
The publication of the survey results caused a sharp drop of the rate, which went through the support of the 200-hour SMA. The decline was afterwards stopped by the weekly pivot point at 1.2871. Future forecasts were based upon whether the pivot point would hold.
Economic Calendar
Next week, the pair could be slightly impacted by the US publications on Wednesday.At 13:30 GMT on that day, the US Durable Goods Orders, Core Durable Goods Orders and Preliminary GDP are scheduled to be released.
In the meantime, the next week's reaction tables have been published. Take a look at the 25.11-29.11 Event Historical Reactions publication.
Read More: 25.11-29.11 Event Historical Reactions
GBP/USD short-term review
By the middle of Friday's London trading, the GBP/USD was located above the support of the weekly pivot point at 1.2871.If the pivot point manages to provide enough support, a surge could occur. In the case of a surge, the rate would meet first with the 200-hour SMA at 1.2898 and afterwards with a resistance cluster near 1.2920.
If the pivot point fails to hold, the rate would have no technical support as low as 1.2823, where the S1 of the weekly pivot points was located at on Friday. In theory, in this scenario the pair would reach this level.
Hourly Chart
On the daily candle chart, an adjustment has been made to the almost horizontal channel pattern. If one uses the high and low levels of the daily candles instead of open and close prices, a different picture from the previous appears.
Namely, the pattern was not pierced during the recent surge. It is still intact and its upper trend line continues to provide resistance.
Daily chart
Read More: Technical Analysis
Traders are mostly short
Since Tuesday, 65% of open GBP/USD position volume on the Swiss Foreign Exchange was in short positions.
Meanwhile, trader orders were set to buy. In the 100-pip range, 76% of orders were to buy and 34% were to sell.
Meanwhile, trader orders were set to buy. In the 100-pip range, 76% of orders were to buy and 34% were to sell.
Previously, the orders were 56% to sell.
As the open position volume proportions have not changed, and a lot of buy orders are close buy, it can be assumed that the orders are close by take profits and stop losses of short positions.
As the open position volume proportions have not changed, and a lot of buy orders are close buy, it can be assumed that the orders are close by take profits and stop losses of short positions.