- The Swiss market is 53% bearish
- 61% of pending orders in the 100-pip range are set to SELL
- US releases and Federal Reserve in focus
The GBP/USD has continued to attempt to pass various resistance levels in the aftermath of the fundamental fall that occurred on Friday. Namely, on Tuesday, the pair was making an attempt to break past resistance levels at 1.3160 and surge higher.
The British pound appreciated against the US Dollar, following the United Kingdom CPI data release on Wednesday at 08:30 GMT. The GBP/USD exchange currency rate gained 39 pips or 0.30% during a minute, right after the release. The rate continued trading at the 1.3181 level.
The Office for National Statistics released United Kingdom CPI data that came out better-than-expected of 2.7%, compared to forecasted 2.4%. The CPI data release is considered the UK's most important inflation data because it's used as the central bank's inflation target.
Mike Hardie, the ONS' head of inflation said in a statement:"Consumers paid more for theatre shows, sea fares and new season autumn clothing last month. However, mobile phone charges, and furniture and household goods had a downward effect on inflation".
Minor data until Wednesday
Prepare for Tuesday, as CB Consumer Confidence data release will most likely cause a small reaction in the financial markets. The data release is set to occur at 14:00 GMT, and it will be covered by the Dukascopy Analytics team.
Although, the most important day of the week for fundamentals will be Wednesday. The weekly US Crude Oil Inventories will be published at 14:30 GMT. The cover webinar for the release, will star as usual at 14:20 GMT.
Meanwhile, the most important data release will be the release of the US Federal Funds Rate. The Federal Reserve is expected to hike their interest rate to 2.25% from 2.00% at 18:00 GMT. The event will be also covered by Dukascopy Analytics live.
GBP/USD short term review
The British pound appreciated 0.40% against the US Dollar since Monday's session. The rate was moving sideways during the previous session to allocate the rate at the 1.3131 mark during Tuesday morning hours.In the near-term future, most likely, the rate will break the weekly PP at the 1.3144 mark and the 50.00% Fibo to trade at the 1.3160 level. The 200-hour simple moving average should support the rate to push it through the mentioned technical indicators during the trading session on Tuesday.
On the other side, the simple moving averages could resist the rate to push it downwards to trade at the 1.3050 level.
Hourly Chart
The volatility caused by the fundamental events initially forced the rate into reaching medium term bullish targets at 1.3300 earlier than expected.
Although, the medium pattern is broken. Most likely new patterns will be spotted, as the markets fully take into account the new information about the Brexit process.
Daily chart
The bearish sentiment of the Swiss Foreign Exchange remains almost unchanged since Friday. Namely, 53% of traders were short on Tuesday.
In the meantime, trader set up orders, which indicate where the rate most likely will go next, are neutral on Tuesday. The orders previously were set to buy.
The traders, which were short on Friday, most likely profited from the decline. However, either they still have not closed their short positions or other traders are chasing the decline.
Spreads (avg, pip) / Trading volume / Volatility