- 52% of pending orders in the 100-pip range are to SELL the Sterling
- SWFX market sentiment is 65% bullish (+2%)
- Upcoming fundamentals: UK Second Estimate GDP q/q, UK Preliminary Business Investment q/q, US (Core) Durable Goods Orders m/m, Fed Chair Powell, BOE Governor Carney and FOMC Member Bostic to speak, US Revised UoM Consumer Sentiment
The Sterling moves along the 55-hour SMA for the second consecutive session.
The British Pound strengthened against the Greenback, following the UK Retail Sales data release on Thursday. The GBP/USD currency pair gained 24 pips, or 0.18%, to continue fluctuating in the 1.3395 area.
The Office for National Statistics released All Retail Sales data that came out better-than-expected of 1.6%, compared to the negative 1.2% in the previous period, moreover doubling the expectations of 0.8% for the month of April.
Retail sellers enjoyed April's jump in sales, which was the biggest in the last 18 months. Petrol, food and fashion clothing sales bounced and pushed sales volumes up as the previous "beast from east" fell off the cliff.
Important fundamentals in sight today
Friday's trading session will start with the British Second GDP estimate for the first quarter of 2018 at 0830GMT. According to estimates, the British economy grew by 0.1% during this time. The UK Preliminary Business Investment for Q1Y2018 is published at the same time.
The Unites States is to release the monthly Durable Goods Orders and Core Durable Goods Orders at 1230GMT. The Revised Consumer Sentiment by the University of Michigan is published at 1400GMT.
In addition, three central bankers are to speak today. The Federal Reserve Chair Jerome Powell and the BOE Governor Mark Carney will participate in a panel discussion titled ‘The future of central banking?' in Stockholm at 1320GMT. Meanwhile, the President of the Federal Reserve Bank of Atlanta Raphael Bostic will participate in a research event on technology-enabled economic disruptions at 1545GMT.
GBP/USD still pressured lower
During the first part of Thursday's trading session, the Sterling managed to maintain its upward movement which started mid-Wednesday. Further advance above the 1.3416 mark was restricted by the 100-hour SMA and the weekly S1. This strong resistance pressured the rate slightly lower along the 55-hour moving average.In line with technical indicators, the Pound should resume its decline in this session, thus approaching the six-month low of 1.3310. This session, however, is full of important fundamentals that could change the market sentiment in favour of bulls.
In case of strong upside momentum, the rate should target the weekly PP at 1.3520; the 200-hour SMA is located at 1.3455. Meanwhile, a fall below the 1.33 level is not expected today.
Hourly chart
Following several days of fluctuating near the 200-day SMA circa 1.3530, the Sterling eventually breached this line and fell down to the 1.3415 mark on Monday morning.
It is expected that a medium-term surge could start this week. In order to confirm this scenario, the aforementioned long-term SMA needs to be surpassed.
Daily Chart
The bullish SWFX market sentiment is strongly bullish with 65% of open positions being long today (+2%). Meanwhile, 52% of pending orders remain to sell the Pound (-3%).
The market sentiment of OANDA traders is strongly bullish, as 61% of them are holding long positions (-1%). Saxo Bank clients are likewise bullish with 59% long positions (+4%).
Spreads (avg, pip) / Trading volume / Volatility