The British currency experienced mixed performance on Thursday, without any sharp movements registered against most major peers, with exception of the GBP/NZD. The Sterling managed to appreciate 0.38% against the Euro, 0.24% versus the Swissie and 0.22% against the Aussie. Meanwhile, losses of 0.32%, 022% and 0.08% were seen against the Buck, the Japanese Yen and the Loonie, respectively, but the most notable development, which was bearish, was registered against the New Zealand Dollar. The GBP/NZD edged 1.69% to the downside, as the Kiwi retained its post RBNZ strength.
Manufacturing production in the UK advanced further bolstering optimism about the domestic economy. UK manufacturing as well as industrial production data outperformed major economists' expectations in April being mainly influenced by the weaker cable due to upcoming Britain's EU referendum. According to the latest figures released by the Office of National Statistics, manufacturing production skyrocketed 2.3%, against March's 0.1%, and an expected growth of 0%. Industrial production, in turn, jumped by 2% in April, adding 0.3% from March, and far above the 0% reading expected. On a yearly pace, manufacturing production added 0.8%, showing much better results than a forecasts for a 1.5% decline as well as after a steep 1.9% drop in March. Concerning industrial production, this data demonstrated an increase of 2.0% following a gain of 0.3% in the preceding month and in line with forecasts.
Meanwhile, analysts warned that despite such a positive figures which provided a strong boost to the economy, it was still too early to say whether the industrial sector had totally strengthened. Moreover, following data spurred the pound, which currently is suffering upcoming Brexit poll's results.
Focus turns to US fundamentals
GBP/USD struggles to preserve the ascending channel pattern
With experiencing another decline on Thursday, the GBP/USD currency pair inched closer to the ascending channel's support line. Technically, we should still see a rebound, as the trend-line is reinforced by the 55-day SMA and managed to provide the Cable with sufficient bullish momentum to keep advancing since March. However, daily technical studies are now giving bearish signals, indicating that a breakout might be imminent. On the other hand, the two-year down-trend has not yet been retested, thus, the immediate support might hold today and eventually cause the Sterling to rebound, leading it back towards the 1.47 major level.
Daily chart
Hourly chart
Bulls and bears remain in balance
There are 56% of traders holding long positions today (previously 52%), while the number of purchase orders increased from 32 to 57%.
Compared to Tuesday, there are also slightly less bulls at OANDA - they take up 54% of the positions open with the Canada-based broker. Sentiment at Saxo Bank is now bearish, as here the number of bears exceeds the number of bulls by 14 percentage points.
Spreads (avg, pip) / Trading volume / Volatility
Majority sees GBP/USD above 1.46 in three months
The majority of traders (53%) believe the British currency is to cost 1.46 or more dollars after a three-month period. The most popular price interval was selected by slightly less than a fifth (15%) of the voters, namely the 1.46-1.48 one, while the second most popular choice implies that the Sterling is to cost either between 1.42 and 1.44, or between 1.44 and 1.46, or between 1.48 and 1.50 or even between 1.52 and 1.54 dollars in three months, all four chosen by 13% of the surveyed. At the same time, the mean forecast for Sep 10 is 1.458.