- 64% of pending orders in a 100-pip range are to sell the pair
- 67% of traders are bullish on the Pound
- Market sentiment is 72% bullish
- Upcoming Events: US Core Durable Goods Orders, Jackson Hole Symposium
As it expected, the Sterling slightly appreciated against the Greenback after announcement of the UK Second Estimate GDP. Unfortunately, afterwards the Pound made two failed attempts to break above the northern boundary of a senior descending channel. Such outcome confirms that the pair should continue to move in the downward direction. However, the speech delivered by Janet Yellen later this day might turn around the rate and dissolve the current formation.
The combination of the UK economic reports contributed to the initial fall of the GBP/USD, though losses were offset immediately. The Sterling weakened against the US Dollar by 20 base points or 0.16% to rebound from the 1.2785 mark and continue moving upward.
The Office for National Statistics reported that the preliminary estimate for the Britain's economic growth in the June quarter was confirmed at 0.3% in line with the previous release. The GDP figures revealed that the UK economy expanded at the slowest pace amongst the G7 this year, as the Brexit uncertainty caused dampening business investment, which missed expectations being flat in the reported period.
Meanwhile, the weaker Pound hurt consumer spending more than supported exporters.
Jackson Hole Symposium
Today will bring no fundamental data from the side of the UK, but a lot of news from the United States.
First of all, at 12:30 GMT the Census Bureau will publish the latest updates on the US Core Durable Goods Orders. This release will be covered by the Dukascopy Research Team at the webinar.
However, the key event of the day will happen at 16:00 GMT when the Fed Chair Janet Yellen will deliver a speech about financial stability at the Jackson Hole Symposium. This event is expected to cause certain turbulence in the markets.
GBP/USD tries to head to the north
In line with expectations, an announcement of the Second Estimate GDP helped the Pound to slightly recover against the American Dollar. In result of the surge, the currency pair has reached the upper boundary of a senior descending channel, but then was forced to make a rebound.
The fact that the pair has subsequently failed to slide through the weekly S1 at 1.2799 indicates that it might make a breakout to the top. However, even if it happens the further movement most likely will be neutralized either by the 100-, or the 200-hour SMA.
But in the meantime, there is a need to take into account the impact that will be brought by the upcoming Janet Yellen speech.
Hourly chart
Even though over the last two days the currency rate remained flat, the general prognoses remain the same. Namely, the pair is expected to continue to move to the bottom, facing no significant barriers on its way.
Daily chart
Sentiment remains bullish
The bullish sentiment continues to dominate, as 72% of open positions being long. Meanwhile, 61% of pending commands in 50-pip range are to sell, while in 100-pip range this number amounts to 64%.
It can be observed that OANDA traders are almost neutral, as 52 % of open positions are short. Meanwhile, traders at Saxo Bank are more bearish on the pair, with 58% of traders holding short positions.