- 57% of pending orders in the 100-pip range are to SELL
- SWFX traders are 51% bullish on the pair
- Rate faces significant resistance circa 1.3415
- Upcoming events: US JOLTS Job Openings
The Sterling edged lower against the US Dollar on the report showing mixed Britain's manufacturing and trade figures. The GBP/USD exchange rate fell 10 base points to continue depreciation in the 1.3400 area.
Britain's manufacturing expanded at its strongest annual pace in a year, while mixed trade figures and a downturn in construction left the market projections divided for the country's economy in 2018. The Office for National Statistics said that the UK factory output marked a 0.1% increase in October. Meanwhile, business surveys indicated that factories were enjoying higher demand from Europe, but also faced further rise in price pressures. The outcome of the country's quit from the EU is expected to be crucial for manufacturers' outlook.
Quiet session
The only fundamental event today in connection with GBP/USD is the US JOLTS Job Openings to be released at 1500GMT. This event, however, is unlikely to have any impact on the market.
GBP/USD tests 1.3410
On Friday, the Pound was actively appreciating against the Dollar being fuelled by reports about progress made on Brexit divorce bill. However, once this anxiety ran out and the US posted another set of positive employment data the pair returned back to the monthly PP located at the 1.3372 mark.
At the moment, the cable is testing combined resistance level set up by the 55-, 100- and 200-hour SMAs as well as the weekly PP at 1.3415. Unless the rate receives a proper impulse from some news, a rebound is expected to happen. Such scenario also looks more plausible from fundamental perspective due to expectations of the upcoming interest rate hike and adoption of tax bill.
However, today a deep plunge is unlikely to happen, as the above monthly PP still represents strong support barrier.
Hourly chart
The Sterling was driven by strong downside risks on Friday, as it fell 92 pips in one session. The pair, however, failed to leave the 1.3485/1.3372 area which has confined it for the last week.
Technical indicators suggest that the Pound is likely to edge lower during this week. It might even breach the monthly PP at 1.3372 today and approach the weekly S1 and the 55-day SMA at 1.3291 and 1.3260, respectively.
Market sentiment is mixed
The SWFX market sentiment has returned in the bullish area on Monday, as 51% of open positions is long. In addition, 55% of pending orders are to buy the Pound (-4%).
OANDA market sentiment is bearish, as 53% of open positions are short (-2%). Saxo Bank clients share the same sentiment with 60% short positions (-6%).