- The Swiss market is 54% bullish on the pair
- Pending orders in the 100-pip range are set to buy in 53% of cases
- UK GDP and Manufacturing Production at 09:30 GMT
As the GBP/USD trades horizontally in the expectations of the Brexit vote, it has pierced the upper trend line of a dominant descending pattern. We still provide technical analysis. Although, note that it is set to be useless soon. The charts clearly show that the market has begun to wait and the future will bring purely fundamental large moves.
Latest Fundamental Event
The Federal Reserve releases US FOMC Meeting Minutes where fed officials provide in-depth insights into the economic and financial conditions that influenced their vote on where to set interest rates.
The meeting summary stated, "With an increase in the target range at this meeting, the federal funds rate would be at or close to the lower end of the range of estimates of the longer-run neutral interest rate, and participants expressed that recent developments, including the volatility in financial markets and the increased concerns about global growth, made the appropriate extent and timing of future policy firming less clear than earlier."
Incoming UK data
Last but not least will be the releases on Friday. UK GDP and Manufacturing Production are expected to cause a 20 pip move at 09:30 GMT.At 13:30 GMT the US CPI and Core CPI data sets might cause a 10-30 pip move.
GBP/USD short term review
During the previous trading session, the 55-hour simple moving average supported the rate to push it towards the 1.2800 level. On Thursday morning, the currency exchange rate was retraced by the bottom boundary of the ascending small pattern line at the 1.2757 mark.Most likely, the British Pound will keep trying to appreciate against the US Dollar to the 1.2800 level. Besides, supports of the 100-hour and the 55-hour simple moving averages will give additional support for the British Pound during the session.
Hourly Chart
The resistance of the daily chart's descending channel has been pierced. The 55-day simple moving average has also been pierced.
The pair has entered a waiting mode just below the 1.2800 level. At that level it looks like the rate will wait for the next notable Brexit news. Namely, the vote.
Dukascopy Analytics already published an article, which explained the basics of Brexit. We intend to publish an after-vote article at the end of the week starting with January 14.01. For more info feel free to write to [email protected]
Daily chart
Meanwhile, trader set up pending orders in the 100-base point range were bullish on Thursday. 58% of orders were set to buy.
The sentiment keeps bouncing around constantly, as traders take into account Brexit announcements and speculate on them instead on take advantage of medium term swings.