- The Swiss market is 61% bullish on the pair (-1%)
- 64% of pending orders in the 100-pip range are set to sell
- Upcoming fundamental events: US (Core) Durable Goods Orders m/m, Fed Chair Powell and MPC Member Haldane to speak, Jackson Hole Symposium
The Pound shows some slight downside potential against the US Dollar in this session.
The Greenback weakened against the British Pound, following the United Kingdom Retail Sales release on Thursday at 08:30 GMT. The GBP/USD currency pair gained 20 pips, or 0.16%.
The Office for National Statistics released UK Retail Sales data that came better-than-expected at 0.7% with the forecasted of 0.2%. The actual data is good for the currency because there come more opportunities for the change in the total value of inflation-adjusted sales at the retail level.
The Office for National Statistics senior statistician, Rhian Murphy said: "Many consumers stayed away from some high street stores in July, but online sales were very strong, supported by several retailers launching promotions. Food sales remained robust as people continued to enjoy the World Cup and the sunshine."
Powell speaks today
Friday's trading session will start with the US monthly Durable Goods Orders at 1230GMT. The market expectation about the core reading is a 0.5% advance during the month of July. The event will be covered by Dukascopy Analytics on the bank's live webinar platform. The cover will start at 12:20 GMT.
Another important fundamental event that could shake the given currency pair is a speech by the Fed Chair Jerome Powell who is to address ‘Monetary Policy in a Changing Economy' at 1400GMT.
GBP/USD enters range
Following no changes to its price level on Wednesday, the Pound began weakening slightly against its American counterpart during the following day. It fell below the 55– and 100-hour SMAs and stopped solely at the 1.28 level early this morning.This has left the rate between the 100– and 200-hour SMAs in a narrow 1.2785/1.2850 range. The Sterling should fluctuate in between those lines during the first part of the day. Even if a breakout occurs to the upside, it is not expected that large gains are apparent today due to the 55-hour SMA being nearby at 1.2872.
Meanwhile, there is slightly greater downside potential, with the next support level being the monthly S2 and the weekly PP at 1.2750. Technical indicators flash bearish signals in this session.
Hourly Chart
On the daily chart one can see that the surge has encountered the upper trend line of the dominant descending channel pattern. The patterns upper trend line is strengthened by the weekly R2 and the monthly S1.
Watch the trend line. If it gets passed the rate will first reach for the 1.30 mark and afterwards above the 1.31 level. If, it stands its ground, the decline of the Pound will resume.
Daily chart
The Swiss trader sentiment edged lower today, with 61% of open positions being long during the morning hours.
However, additional long positions are unlikely going to be open. Retail traders of the Swiss Foreign Exchange have set up 61% of all of their pending trade orders to sell. This number has been increasing step by step from 53% throughout the week.
Meanwhile, OANDA traders remain largely bullish, as 63% of open positions are long at the brokerage. In the meantime, traders at SAXO Bank are 61% long on the GBP/USD pair.
Spreads (avg, pip) / Trading volume / Volatility