- 56% of pending orders in the 100-pip range are to SELL the Sterling
- SWFX market sentiment is 64% bullish (-2%)
- Upcoming fundamental events: UK Manufacturing PMI, US Average Hourly Earnings m/m, US Non-Farm Employment Change, US Unemployment Rate, ISM Manufacturing PMI, G7 meetings
Technical signals are more in favour of the bearish scenario for the Pound today.
The Bureau of Economic Analysis released Preliminary Gross Domestic Product data that came out lower-than-expected of 2.2%, compared to the 2.5% in the previous period.
"The revision to headline GDP growth was small, as were most of the revisions to GDP components. The standouts were weaker inventory investment, weaker residential investment and stronger business investment," said Chris Low of FTN Financial Group.
US in focus
Friday's trading session will start with the British Manufacturing PMI published at 0830GMT. Meanwhile, the remaining session is allocated to US fundamentals. The Bureau of Labour Statistics will release the monthly Average Hourly Earnings, Non-Farm Employment Change and Unemployment Rate at 1230GMT. The ISM Manufacturing PMI is published at 1400GMT.
GBP/USD falls below SMAs
Bulls dominated the GBP/USD exchange rate during the first part of Thursday. This upside momentum was stopped by the strong resistance of the 200-hour and 55-period (4H) SMAs at 1.3350. Bulls failed to move the rate above this barrier, thus paving the way for a subsequent surge past the 55– and 100-hour SMAs and down to 1.3260 where it was located at the time of this analysis.Technical indicators show mixed results today. However, given that the pair is located below all three SMAs, it might still continue moving lower during this session. It should be noted that this assumption could be disrupted by today's fundamentals that are likely to push the rate in any direction.
By and large, the pair is expected to remain within the 1.3200/1.3350 range.
Hourly chart
The Sterling has plunged 7.28% against the US Dollar since mid-April. Despite lingering near the 200-day SMA for a couple of days, downside risks prevailed and pushed the rate as low as the 1.33 mark early on Monday.
Technical indicators are located at historic lows. Thus, a recovery should occur in the nearest time. The nearest support is set by the monthly S2 at 1.3290.
Daily Chart
The bullish SWFX market sentiment is strongly bullish with 64% of open positions being long today (-2%). Meanwhile, 56% of pending orders remain to sell the Pound (+1%).
The market sentiment of OANDA traders is bullish, as 67% of them are holding long positions. Saxo Bank clients are likewise bullish with 63% long positions (+2%).
Spreads (avg, pip) / Trading volume / Volatility