- 52% of pending orders in the 100-pip range are to SELL
- Traders are bullish with 54% long positions (-1%)
- Downside potential until 1.39
- Upcoming events: US (Core) Retail Sales m/m, US (Core) PPI m/m
The US Bureau of Labour Statistics revealed on Tuesday that February consumer price index hit the forecasts, rising at a 0.2% pace, following the 0.5% up-move recorded in the previous month.
The US Labour Department raised concerns that inflation is likely to accelerate, and, as a result, the Fed could hike interest rates faster than anticipated. Investors are carefully watching the situation in the market and looking for clues on how quickly the rates could be raised.
US fundamentals in focus
The main focus in this session will be put on the US Retail Sales and the Price Producer Index for January to be released together with core data at 1230GMT.
The Census Bureau projects a 0.4% increase in the Core Retail Sales and a 0.3% rise in Retail Sales, compared to 0.0% and -0.3%, respectively, during the previous month. Meanwhile, the Producer Price Index is expected to have gained 0.1% in February.
GBP/USD allays on Wednesday morning
The market was calm on Tuesday morning, as traders were awaiting the British Annual Budget report and the US inflation data.The first event did not cause any reaction, while the latter shook up the market significantly with a 100-pip surge within a couple hours. The bullish sentiment was likewise strengthened by Trump's unexpected decision to fire the US Secretary of State. As a result, the pair breached a six-week down-trend, the weekly R1, the monthly PP and the 38.20% Fibo retracement.
The following hours were once again spent without major advances, thus suggesting that some correction south could be possible today. The southern limit for today could be the the aforementioned pivot points at 1.3930. Subsequently, the rate is expected to surge up to the senior channel circa 1.40.
Hourly chart
The GBP/USD currency pair was moving along the 55-day SMA during the previous week. The Pound, however, failed to surpass the 1.40 mark, thus diminishing its trading range.
Even though some upward momentum might still follow this week, it seems that the pair is ready to breach the aforementioned moving average decline down to the bottom boundary of the senior channel located near 1.3650.
Daily Chart
The market sentiment of SWFX traders is bullish with 54% of open positions being long (-1%). Meanwhile, 52% of pending orders are to sell the Sterling (+1%).
The market sentiment of OANDA traders has turned bullish with 51% long positions, compared to 52% short positions on Tuesday. Saxo Bank clients have decreased notably their bearish sentiment, as 55% of open positions are short (-5%).
Spreads (avg, pip) / Trading volume / Volatility