- 62% of pending orders in the 100-pip range are to SELL the Sterling
- SWFX market sentiment is 64% bullish
- Quiet day in terms of fundamentals
The bearish sentiment is likely to dominate the Sterling today.
The Census Bureau released two data sets simultaneously, where Residential Building Permits for the month of April came out in line with a forecast of 1.35M, moreover, the same number was released in the previous period.
The US Dollar's slight weakening may be affected due to the lower-than-expected Housing Starts data of 1.29M, compared to the forecast of 1.32M.
No fundamentals to focus on
The only fundamental event in this session is a speech by the Federal Reserve Governor Lael Brainard titled "Community Reinvestment Act Modernisation" scheduled for 1315GMT. This event is very unlikely to cause any effect in the market.
GBP/USD falls back below 1.3540
Despite breaching the massive resistance of the 100– and 200-hour SMAs, the weekly PP and the 61.80% Fibonacci retracement at 1.3550 early on Thursday, the pair had returned below this cluster by mid-session.Given that this level is likewise reinforced by the 55-period (on 4H chart) and the 200-day SMAs near 1.3570, the Pound might be reluctant to make significant advances, especially if no important data releases are scheduled for this session. Technical indicators also flash bearish signals for the remaining part of this week.
It is not expected that the pair breaches its nearest resistance formed by the weekly S1 and the 2018 low of 1.3460, thus remaining near the 1.3480/50 range by Monday morning.
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. Even though the given moving average was breached this week, the Pound has nevertheless remained near this line. Thus, it is still expected that the 50.0% Fibonacci retracement marks a reversal point from which the Sterling moves towards 1.40 during the following weeks.
Daily Chart
The bullish SWFX market sentiment has remained unchanged with 64% of open positions being long today. Meanwhile, 62% of pending orders remain to sell the Pound (+2%).
The market sentiment of OANDA traders is strongly bullish, as 63% of them are holding long positions (+3%). Saxo Bank clients share the same sentiment with 58% long positions (+5%).
Spreads (avg, pip) / Trading volume / Volatility