- 60% of pending orders in the 100-pip range are to BUY the Sterling
- SWFX market sentiment is 64% bullish (+2%)
- Upcoming fundamental events: FOMC Member Mester to speak
The following hours are likely to demonstrate which direction is to prevail in this session.
The British Pound weakened against the Greenback, following the UK Official Bank Rate data release on Thursday. The GBP/USD currency pair lost 76 pips, or 0.56%, to continue going down to the 1.3478 level.
The Bank of England released four datasets simultaneously from which Official Bank Rate was left unchanged of 0.5% for the fifth time straight, and MPC Official Bank Rate Votes also stayed in the same proportions as from the last time of 2-0-7.
The Bank of England also released BOE Inflation Report and Monetary Policy Summary, but these data releases most probably were traded by algorithms, that are capable of reading the textnd understand its context.
Lack of fundamentals today
No fundamentals are scheduled for today. This session is a complete contrast to tomorrow when several important data sets are to be released.
GBP/USD returns to 1.3560
The Sterling has been trading in a channel down against the US Dollar since early May. Thus, the pair has since not been able to form a distinctive movement either direction. No changes to the pair's positioning were likewise introduced on Friday, as the relatively calm session left the rate near the 55-, 100– and 200-hour SMAs.In case the two shorter-term SMAs and the weekly PP are breached at 1.3540, the rate is likely to edge lower and test its next support—the weekly S1 at 1.3465. A fall below this level is very unlikely, especially if no fundamental releases are scheduled for today.
Meanwhile, a reversal from 1.3540 would send the Pound for a test of the weekly R1 at 1.3622. A possible daily high should be the weekly S2 and the breached senior channel near 1.37.
Hourly chart
Strong downside risks have been pushing the GBP/USD exchange rate considerably lower for the third consecutive week. As a result, the pair reached the 200-day SMA near 1.3530 last week and has since remained near this line.
Technical indicators on the daily time-frame are located in the overbought territory. Thus, this moving average might mark a reversal point from which the Pound should move towards the 1.40 mark during the following weeks.
Daily Chart
The bullish SWFX market sentiment has increased to 64% of open positions being long today (+2%). Meanwhile, 54% of pending orders remain to sell the Pound (-1%).
The market sentiment of OANDA traders is strongly bullish, as 65% of them are holding long positions (+4%). Saxo Bank clients share the same sentiment with 56% long positions (+1%).
Spreads (avg, pip) / Trading volume / Volatility