As expected, on Thursday the GBP/USD reached the 1.2850 level. This level provided the rate with support, and, by the middle of Friday's London trading hours, the pair had reached the resistance levels near 1.2920.
In general, future forecasts were based upon what would occur at the 1.2920 level.
UK Retail Sales
The British Pound appreciated against the US Dollar, following the UK Retail Sales release on Thursday at 09:30 GMT. The GBP/USD exchange currency rate gained 11 pips or 0.08% after the release. The Pound continued trading at the 1.2910 level against the Greenback after the release.
The Office for National Statistics released the UK CPI data, which came out better-than-expected of 0.9% compared with the forecast of 0.7%.
According to the official release: "Retail volumes increased by 0.9% in January 2020, recovering from the falls in the previous two months; the increase was mainly because of moderate growth in both food stores (1.7%) and non-food stores (1.3%)."
Economic Calendar
Next week there are no notable events that might impact the currency exchange rate. However, some economic calendars have US events listed as high impact.
On Thursday, at 15:30 GMT the US Durable Goods Orders are set to be published. This event has caused moves from 6.2 to 16.8 pips since August.
Moreover, the 16.8 pip move was an anomaly caused by the simultaneous release of other data together with the Durable Goods orders. Without it, the range is from 6.2 to 11.5 pips.
At the same time, the US Preliminary GDP is scheduled to be published. This is the other data set that together with the Durable Goods orders caused a 16.8 pip move. Without the other data, the GDP has caused moves from 8.0 to 16.1 pips.
The week's data is available. Click on the link below to see the historical data tables with the reactions to various events.
GBP/USD short-term review
At midday GMT hours, on Friday, the GBP/USD currency exchange rate was located near the 1.2920 level, where it was testing technical resistance levels. Namely, a 38.20% Fibo, the 55-hour SMA and the weekly S1 simple pivot point.In the case of the resistance being broken, the pair would surge up to the 100-hour simple moving average, which was located near the 1.2960 level.
On the other hand, the resistance might hold and cause a decline. In this case scenario, the pair would once again test the support of the 1.2850 level.
Hourly Chart
On the daily candle chart, the rate has broken out of the squeeze between the 55 and 100-day simple moving averages. Due to that reason a sharp move down is expected.
Meanwhile, the pair has no support on the chart as low as 1.2800. It is the first target of the described possible decline.
Daily chart
Meanwhile, trader orders were set to sell. In the 100-pip range, 58% of orders were to sell and 42% were buy orders.
Previously, the pending trade orders were 56% to buy.