The GBP/USD has continued to drop, as the currency exchange rate reached the 1.2300 level.
However, on Monday the pair began to trade sideways, as it had become oversold and needed a period of consolidation.
Economic Calendar
On Tuesday, the US Retail Sales could cause a small move in the markets at 14:30 GMT.
On Wednesday, the event of the week is set to occur, as at 20:00 GMT the FOMC Statement and Federal Funds Rate are going to be published.
Meanwhile, Dukascopy Analytics are not publishing the historical reactions this week, as the market environment has changed to such a degree that the historical data is unlikely to be relevant.
GBP/USD short-term review
On Friday, the GBP/USD exchange rate declined to the 1.2300 level. During today's morning, the rate was testing the given level.It is likely that the currency pair could remain under pressure of the monthly S2 at 1.2452 and trade downwards in the short term. In this case the pair would have to surpass the monthly S3 at 1.2178.
On the other hand, the British Pound could consolidate against the US Dollar in the short run. Also, it is unlikely that bulls could prevail, and the rate could exceed the monthly S1 at 1.2637.
Hourly Chart
On the daily candle chart, the drop of the pair can be observed better. One can see that the cluster of support levels near the 1.2600 level did not hold. In addition, the channel down pattern was broken.
Daily chart
Read More: Technical Analysis
Traders remain neutral
Since Friday, 53% of open GBP/USD position volume on the Swiss Foreign Exchange has been in long positions.
The sentiment has been almost neutral for more than a week.
The sentiment has been almost neutral for more than a week.