- 55% of pending orders in the 100-pip range are bearish
- SWFX market sentiment is 59% bullish (+5%)
- Upcoming fundamental events: British Manufacturing PMI and Net Lending to Individuals m/m, US ISM Manufacturing PMI
The Pound remained stable against the Greenback on Tuesday morning; upward momentum is expected today.
The British Pound weakened against the Greenback, following the UK Prelim GDP data release on Friday. The GBP/USD currency pair lost 71 pips, or 0.51%, to continue fluctuating in the 1.3812 area.
The Office for National Statistics released Preliminary Gross Domestic Product data for Q1 2018, that came out less-than-expected of 0.1%, failing to reach the forecast of 0.3%, showing the slowdown, compared to 0.5% increase in the Q4 2017.
One of the main reasons for low UK GDP's growth pace is due to the construction being the biggest downward pull, causing the GDP to reach the lowest increase since Q4 2012.
Manufacturing PMIs today
The Markit is set to release the British Manufacturing PMI for April at 0830GMT, while the same set of data is likewise published by the Institute for Supply Management at 1400GMT.
GBP/USD continues moving sideways
Monday's trading session was calm for the GBP/USD currency pair, as it remained trading sideways for the second consecutive session. Despite bears failing to push the pair down to the weekly S1 at 1.3979, the expected up-move towards 1.3885 did not occur either.Technical indicators are starting to recover; thus, the price should follow soon. A strong surge is likely to be limited by the nearby-located 55-hour SMA. The pair, however, should eventually reach the 1.39—a move which might actually be boosted by today's British Manufacturing PMI and the ISM Manufacturing PMI released at 0830GMT and 1400GMT, respectively.
It is unlikely that the 1.39 level is breached in this session, and the same assumption holds for the 1.3660 area where the senior channel and the weekly S1 are located.
Hourly chart
The Sterling has depreciated substantially against the Greenback during the past two weeks. Last week marked a breakout from the 55- and 100-day SMAs that add some ground to continuous downside potential.
By Monday morning, the pair had approach the lower boundary of the senior channel circa 1.3960. It seems that the following days should mark a brief bullish reversal prior to breaching this long-term pattern and approaching the 200-day SMA near 1.35.
Daily Chart
The SWFX market sentiment has strengthened by five percentage points, as 59% of open positions are long today. Meanwhile, 59% of pending orders remain to sell the Pound (-6%).
The market sentiment of OANDA traders has turned bullish, as 54% of them are holding long positions (-2%). Saxo Bank clients share the same sentiment with 53% long positions.
Spreads (avg, pip) / Trading volume / Volatility