The Conference Board Consumer Confidence Index dropped more than experts estimated. In April, it lost 3.8% and reached 120.3, thus, marking the first decline since January. The fall was mainly attributable to the less optimistic view of business conditions and the labour market in the upcoming six months. As a result, the number of respondents, who evaluated business conditions as "good", decreased from 32.4% to 30.2% and the share of those, who assessed the available number of jobs in the market as "plentiful", plunged from 31.8% to 30.8%.
In addition, the number of people who evaluated business conditions as "bad" increased slightly from 13.1% to 13.8%. Yet, the share of consumers that believed jobs were "hard to get" remained unchanged at 19.1%. The Conference Board's data confirmed the view that in the short-run consumers would likely to limit their spending and put more emphasis on savings accumulation. Tuesday's data also showed that the number of people, who thought that business conditions would worsen over the next six months, rose from 8.5% to 10.9%, while the share of those expecting weaker job creation surged from 12.7% to 13.1%. Nevertheless, the majority of respondents still believed that the economy would continue growing in the months ahead.
US Durable Goods Orders are the main event today
GBP/USD: consolidation at risk
Wednesday ended with the British currency erasing all intraday losses against the US Dollar, but with no significant gains registered. A close barely above the 1.2850 psychological resistance now allows the Cable to continue edging further up, with the monthly R2, the weekly R1 and the upper Bollinger band forming another supply area around 1.2950. Although technical indicators support the possibility of another rally, the tide could still turn once the US fundamentals are released later today. Upbeat data is likely to provide the Greenback with a boost, in which case the Cable's consolidation trend would be preserved.
Daily chart
Hourly chart
Traders are equally divided
There are slightly more bulls today, namely 52% (previously 51%). At the same time, the number of orders to acquire the Sterling remained unchanged at 57%.
A less optimistic situation is observed elsewhere. The sentiment at OANDA remains bearish, namely 55% of all open positions are short and the remaining 45% are long. Meanwhile, sentiment at Saxo Bank worsened again over the day, with 53% of traders now being short and the other 47% being long the Sterling against the US Dollar.
Spreads (avg, pip) / Trading volume / Volatility
Traders still indecisive
By the end of the next three months traders believe the Cable is to rise above the 1.26 major level, as 58% of survey participants believe so. While the current price is around 1.28, the average forecast for July 27 is 1.2711. The 1.30-1.32 range is now the most popular price interval, having 19% of the votes, while on the second place is the 1.28-1.30 one, with 15% of poll participants choosing it. Furthermore, the 1.18-1.20 and the 1.34-1.36 intervals were each selected by 11% of the voters.