In the near term future, the rate was expected to bounce off the upper trend line of the pattern and resume its decline. In the case of a decline, the pair would aim for the support of the weekly S1 pivot point at 1.2968.
Economic Calendar
During the last week of January, most attention will be paid to the US Federal Reserve and the Bank of England. Both central banks have scheduled their rate announcements for this week.
The US will be the first to publish their rate. The FED's event is scheduled for 19:00 GMT on Wednesday. This time, no rate cut is expected. GBP/USD has moves 17.0 and 21.3 pips during the times that no rate cut has occurred.
The Bank of England will announce their rate decision on Thursday, at 12:00 GMT. The announcement, without any rate changes, since June 2019 has caused GBP/USD moves from 21.3 to 83.6 pips.
Afterwards, on the same day, the US Advance GDP will be released at 13:30 GMT. A move from 11.5 to 36.1 pips can be expected.
The week's event historical data tables have been published. Click on the link below to read the article.
Read More: 27.01-31.01 Event Historical Reactions
GBP/USD short-term review
Yesterday, the GBP/USD exchange rate declined to the lower boundary of a short-term descending channel at 1.2980. During Wednesday morning, the rate was testing the upper channel line.From a theoretical point of view, it is likely that a reversal south could occur in the nearest future. In this case the currency pair could gain support of the weekly S1 at 1.2968.
It is unlikely that a breakout south from the given channel could occur in the nearest future due to the resistance cluster formed by the 55-, 100– and 200-hour SMAs, as well the weekly PP in the 1.3038/1.3072 area.
Hourly Chart
On the daily candle chart, the rate has passed the support of the 55-day simple moving average, which has kept the pair from declining since late December. On Wednesday, the technical indicator began to provide resistance.
Daily chart
Read More: Technical Analysis
Traders are neutral
On Tuesday, 53% of open GBP/USD position volume on the Swiss Foreign Exchange was in short positions.
By the middle of Wednesday's London trading hours, the sentiment was 51% short.
Meanwhile, trader orders were bullish. In the 100-pip range, 58% of orders were to buy and 42% were sell orders.
The orders were 50/50 balanced on Tuesday.
By the middle of Wednesday's London trading hours, the sentiment was 51% short.
Meanwhile, trader orders were bullish. In the 100-pip range, 58% of orders were to buy and 42% were sell orders.
The orders were 50/50 balanced on Tuesday.