- The Swiss market is 57% bullish on the pair
- 56% of pending orders in the 100-pip range are set to SELL
- Canadian data in focus
As the Services PMI data was released, the GBP/USD did not stop its decline. The currency exchange rate was set to reach new low levels, as it had passed one of the last notable technical support levels on Wednesday morning.
The British Pound weakened against the US Dollar, following the United Kingdom Construction PMI release on Tuesday at 08:30 GMT. The GBP/USD exchange currency rate lost 18 pips or 0.14% at the time of the release. The British Pound kept going downwards after the data release to continue trading at the 1.2825 area.
The Markit released Manufacturing PMI data came lower-than-expected. Namely, it was 52.9, compared with the forecast of 54.9.
Tim Moore, Senior Economist at IHS Markit and author of the Markit/CIPS Construction PMI, noted: "Civil engineering was the worst performing area of the construction sector, with output in this category falling for the first time since March amid reports citing a lack of new work on infrastructure projects. House building saw a particularly sharp slowdown since July, meaning that commercial construction was the fastest growing sub-sector in August."
Canadian data will create volatility
On Wednesday, only the Canadian government and central bank will release data that will be notable enough for it to be monitored by Forex traders.
Namely, the Canadian Trade Balance will be published at 12:30 GMT and the Bank of Canada will publish their Overnight Rate at 14:00 GMT. Both data releases will be covered by Dukascopy Analytics. The data coverages will begin ten minutes before the data is released, respectively, 12:20 GMT and 13:50 GMT.
Meanwhile, note that most major financial instruments will start suddenly bouncing around on US macroeconomic data releases on Thursday, as the ADP Non-Farm Employment Change will be released at 12:15 GMT and the ISM Non-Manufacturing PMI will be out at 14:00 GMT.
Moreover, it will continue into Friday. On Friday, at 12:30 GMT three US employment data sets will be published.
GBP/USD short term review
The short term forecast published in the morning in the Technical Analysis section was fulfilled faster than it was incorporated into the Trading Ideas section.A quick update – the rate passed the medium pattern's support line. Moreover, it tested the trend line as a resistance and, if to bounces off it clearly, the rate will set its path down to the 1.2730 level, where the weekly S2 is located at.
Hourly Chart
The 55-day simple moving average can be observed on the Daily chart as the one, who pushed the rate lower on Thursday. The recent fall was only a continuation of the decline, which was caused by the SMA.
Meanwhile, a large scale speculative pattern has been added to the chart. If the rate resumes its surge in the future on the chart and aims for the upper trend line of the channel in the same angle, as the recent surge, the rate could reach the 1.3100 level by October.
Daily chart
The Swiss trader sentiment remains largely bullish. Namely, traders of the Swiss Foreign Exchange were long in 59% of all of their open positions.
In the meantime, trader set up orders, which indicate where the rate most likely will go next, are set to sell the pair in 52% of all cases. This fact indicates that the retail traders are undecided in regards to the pair's short term future.
Meanwhile, OANDA traders remain largely bullish, as 63% of open positions are long at the brokerage. In the meantime, traders at SAXO Bank are 59% long on the GBP/USD pair.
Spreads (avg, pip) / Trading volume / Volatility