On Monday morning, the GBP/USD was set to once more test the resistance of the 1.2350 level
Note that the rate is supported by the 55-, 100- and 200-hour moving averages. Thus, some upside potential could prevail in the market.
UK GDP and Manufacturing Production
The British Pound appreciated against the US Dollar, following the UK Manufacturing Production and GDP data releases on Monday at 08:30 GMT. The GBP/USD exchange currency rate gained 13 pips or 0.10% right after the release. The Pound continued trading at the 1.2300 level against the Greenback.
The Office for National Statistics released the UK Manufacturing Production data, which came out better-than-expected of 0.3% compared with the forecast of the negative 0.3%. The UK GDP data also came out better-than expected of 0.3% compared with the forecast of 0.2%.
The Head of GDP Rob Kent-Smith commented the release: "While the largest part of the economy, services sector, returned to growth in the month of July, the underlying picture shows services growth weakening through 2019."
Economic Calendar
This week there are couple data releases both from the UK and the US that could move the GBP/USD exchange rate.
On Tuesday, September 10, the UK Employment data set will be published at 8:30 GMT. Previously, the release caused a sixteen-pip move.
On Wednesday, September 11, the US Producer Price Index data will be released at 12:30 GMT.
On Thursday, September 12, the US Consumer Price Index data will be published at 12:30 GMT. Last data release caused a nineteen-pip move.
On Friday, September 13, the US Retail Sales data will be published at 12:30 GMT. Last time, the GBP/USD exchange rate moved for almost 19 pips.
GBP/USD short-term review
At the end of previous week, the GBP/USD exchange rate consolidated at the monthly R1 at 1.2314. During Monday morning, the rate declined slightly to the 1.2250 mark.Note that today the UK Parliament will vote on early general election. Thus, volatility might increase in the market. From a technical perspective the currency pair could be supported by the 100– and 200-hour SMAs, as well the weekly and monthly PPs in the 1.2165/1.2217 range. Also, note that the pair could be pressured by 55-hour SMA at 1.2299.
Also, note that the UK Manufacturing Production and GDP data releases will be published at 8:30 GMT. Since April, those releases has moved the pair from 9.2 to 39.2 pips.
Hourly Chart
On the daily candle chart it is seen that the GBP/USD currency pair is testing the 55-day moving average.
If the given resistance holds, it is likely that a reversal south could occur in the nearest future.
Daily chart
Read More: Technical Analysis
Traders remain long
On Friday morning, SWFX sentiment was 57% long. By the middle of Monday's London trading, the sentiment was 59% long.
Meanwhile, trader set up pending orders in the 100-pip range were slightly bearish, as 64% of orders were set to sell and 36% were to buy.
Meanwhile, trader set up pending orders in the 100-pip range were slightly bearish, as 64% of orders were set to sell and 36% were to buy.