The top event of the week will take place on Tuesday at 13:30 GMT. The US Consumer Price Inflation data will be published at that time. The inflation data is set to reveal whether the US Federal Reserve was correct in its assumptions that inflation had slowed down its pace of growth.
Prior to the CPI, the Pound might adjust in value due to the United Kingdom's employment data release at 07:00 GMT. The release will consist of unemployment Claimant Count Change and the Average Earnings Index.
On Wednesday, the United Kingdom's Consumer Price Index could impact the pair through the value of the GBP at 07:00 GMT.
Afterwards, watch out for the US Retail Sales data and the Empire State Manufacturing Index. Both of these events might impact the US Dollar's value at 13:30 GMT.
On Thursday, the US Producer Price Index is set to reveal how inflation has changed at the producer level. The publication is scheduled for 13:30 GMT.
GBP/USD short-term view
A resumption of the broader decline of the Pound against the US Dollar could look for support in round levels at 1.2050 and 1.2000, prior to approaching the February low level zone at 1.1960/1.1970. Below the zone, note the previous low levels of the pair at 1.1900 and 1.1840.However, in the case of a recovery of the GBP/USD the pair is set to face the 200-hour simple moving average near the 1.2150 level and the 1.2200 mark. Higher above, note the low and high level zones that surround the 1.2250 level.
Hourly Chart
GBP/USD daily chart's review
On the daily candle chart, the pair has bounced off the resistance zone at 1.2305/1.2455. Moreover, it has passed below the combined support of the 50-day simple moving average and the lower trend line of the channel up pattern, which had guided the pair up since late September.More recently, the 100-day simple moving average has acted as support and slowed down the sharp decline. In addition, the 50-day SMA has acted as resistance.
Next target for the decline could be the 200-day simple moving averages and the support zone at 1.1740/1.1840.
Daily chart
Read More: Technical Analysis
Traders are short
On Friday, traders were 53% bearish, as 53% of trader open position volume on the Swiss Foreign Exchange was in short positions.
In the meantime, pending orders in a 100-base point range around the pair were 67% to sell the GBP/USD.
On Friday, traders were 53% bearish, as 53% of trader open position volume on the Swiss Foreign Exchange was in short positions.
In the meantime, pending orders in a 100-base point range around the pair were 67% to sell the GBP/USD.