- 57% of pending orders in the 100-pip range are to BUY
- Market sentiment is at equilibrium
- Rate faces support circa 1.3430
- Upcoming events: UK Manufacturing Production m/m, UK Goods Trade Balance, US Average Hourly Earnings m/m, US Non-Farm Employment Change, US Unemployment Rate, US Preliminary UoM Consumer Sentiment
The Sterling was little changed against the Greenback, following the UK housing price growth data from Halifax. GBP/USD was in a side move early Thursday, though the pair gained 54 base points or 0.40% to the 1.348 mark, as a reaction on the Irish official saying that Britain and Ireland were very close to cut the deal.
Halifax report showed that the UK house prices increased more than anticipated 0.5% in November, while the yearly pace of growth slowed to 3.9% from 4.5% in the prior month. Ahead of the Theresa May's meeting with the European Council President and the European Commission Presidents to make a final decision on the Irish border issue, Britain's manufacturing and industrial production data will be in focus.
UK and US fundamentals
The day will start with the British Manufacturing Production and Goods Trade Balance for the month of October at 0930GMT.
Later in the day, the United States is to publish data on Average Hourly Earnings, Non-Farm Employment Change and Unemployment Rate for November at 1330GMT. The University of Michigan is to release its Preliminary Consumer Sentiment at 1500GMT.
GBP/USD heads upwards amid Brexit news
During previous trading session the pair initially slipped to support line located at the 1.3338 mark but then suddenly resumed the surge and ended the day at the 50% Fibonacci retracement level. The drop was based on reports about the action made by Congress aimed to avoid government shutdown, while the surge reflected progress made on the Irish border deal.
As Theresa May heads to Brussels to resume the talks, the Pound is expected to continue appreciating against the Dollar, trying to reach the 1.3550 mark. However, this upward movement might be quickly stopped in case of disappointing news coming from Belgium's capital.
If this negative scenario materializes a combination of the 55-, 100- and 200-hour SMAs together with the weekly PP are unlikely to keep the bearish pressure.
Hourly chart
Pound was driven by strong upside risks on Thursday, as it closed the session with a 80-pip gain. As a result, the pair dashed through the weekly PP and approached the 50.0% Fibonacci retracement line. The same upward movement is apparent this morning, as well.
In case no fundamentals shake the market considerably, the base scenario favours a close in the green area. The Pound might even realise its bullish potential up to the weekly R1 at 1.3610.
Bearish sentiment strengthens
The SWFX market sentiment stands at equilibrium, thus losing one percentage point from its bullish position on Thursday. Meanwhile, 59% of pending orders are to buy the Pound.
OANDA market sentiment is bearish, as 55% of open positions are short in this session (+1%). Saxo Bank clients share the same sentiment with 66% short positions (+4%).