- 56% of pending orders in the 100-pip range are to SELL the Sterling
- SWFX market sentiment is 57% bullish (-1%)
- Upcoming fundamental events: UK Services PMI, US Preliminary Nonfarm productivity q/q, US Preliminary Unit Labour Costs q/q, US Unemployment Claims, ISM Non-Manufacturing PMI
GBP/USD was located near the senior channel early on Thursday with slight upside potential.
The British Pound strengthened against the Greenback, following the UK Construction PMI data release on Wednesday. The GBP/USD currency pair lost 13 pips, or 0.09%, to continue fluctuating in the 1.3687 area.
The Markit released Construction Purchasing Managers' Index that came out better-than-expected of 52.5, compared to the 47.0 in the previous period, at the same time reversing the industry's contraction to expansion.
"A rebound in construction activity was pretty well inevitable after snowfall resulted in severe disruptions on site during March" said Senior Economist at IHS Markit Tim Moore.
Active trading day
Thursday's trading session includes several important data releases, such as the British Services PMI and the ISM Non-Manufacturing PMI at 0830GMT and 1400GMT, respectively.
Meanwhile, some data releases of intermediate importance are likewise included in today's calendar, for instance, the US Bureau of Labour Statistics is to publish the Preliminary Nonfarm Productivity and Unit Labour Costs at 1230GMT. The weekly US Unemployment Claims are published at the same time.
GBP/USD falls to strong support
Some downside movement was still apparent in the market on Wednesday, as the Pound still tried to reach the bottom boundary of a seven-month channel and the weekly S2 near 1.3550. From the upside, it was pressured by the 55-hour SMA.Nevertheless, yesterday's trading session demonstrated that the strong bearish momentum which had guided the pair for the three previous sessions was gone. Thus, it seems that bulls might finally be ready to push the pair away from the aforementioned long-term support. This upward movement should not be steep, as the 1.37 area is restricted by the 55– and 100-hour moving averages and the weekly S1.
In case no fundamentals disrupt this assumption, it is more likely that the pair consolidates today prior to picking up speed on Friday or early next week.
Hourly chart
Strong downside risks have been pushing the GBP/USD exchange rate considerably lower for the second consecutive week. As a result, the pair had reached the 200-day SMA near 1.3530 by Thursday morning.
Technical indicators on the daily time-frame are located in the overbought territory. Thus, the aforementioned moving average might mark a reversal point from which the Pound tries to move towards the 1.40 mark within the following week.
Daily Chart
The SWFX market sentiment is bullish, as 57% of open positions are long today (-1%). Meanwhile, 69% of pending orders remain to sell the Pound (+6%).
The market sentiment of OANDA traders has turned bullish, as 55% of them are holding long positions (+1%). Saxo Bank clients share the same sentiment with 54% long positions (+1%).
Spreads (avg, pip) / Trading volume / Volatility