The Pound reacted to the news with a surge above 1.2700, which extended the previous gains that occurred after the Federal Reserve hikes on Wednesday. By the middle of Friday's trading, the rate had reached above 1.2750, which was confirmed as support. However, the pair had not approached the 1.2800 mark and the resistance levels above it. Economic Calendar
During the week before Christmas, there will be a couple of data releases that could impact the financial markets.
First of all, on Wednesday the United Kingdom Office for National Statistics will publish the UK's Consumer Price Index change at 07:00 GMT.
On Thursday, not the publication of the US Final GDP at 13:30 GMT. This is the final of the three quarterly US GDP releases. The United States release quarterly Gross Domestic Data over a span of a quarter. Data is published in three releases – Advance, Preliminary and Final. The most impact comes from the Advance GDP, and the least is from the upcoming Final GDP.
On Friday morning, the UK Retail Sales data could impact the Pound at 07:00 GMT. Also on Friday, the United States Bureau of Economic Analysis will publish the Core Personal Consumption Expenditure Price Index at 13:30 GMT. The change of the index shows how inflation impacts consumers. It is different from the CPI with the fact that it measures only goods that are consumed by individuals.
GBP/USD hourly chart analysis
An extension of the Pound's surge against the US Dollar is set to face the 1.2800 mark, the weekly R2 simple pivot point at 1.2812 and the August high level at 1.2819. Higher above note that the 1.2850Meanwhile, a decline of the currency pair would look for support in the 1.2720/1..2730 range. Further below, note the weekly R1 simple pivot point at 1.2678 and the 50-hour simple moving average. If all these levels fail, the pair could move to the 1.2590/1.2610 range, the 100 and 200-hour simple moving averages and the weekly simple pivot point.
Hourly Chart
GBP/USD daily chart's review
On the daily candle chart, the 1.2700/1.2720 resistance is passed and might soon turn into a support range.Resistance is provided by the 1.2800/1.2850 range. This range kept the pair down in June and August. A move above it could encounter resistance in the 1.3000 mark, before the rate reaches the July high levels above 1.3100.
On the other hand, a decline below 1.2700 might look for support in the 200-day simple moving average and the supporting trend line near 1.2530. However, it has been the 1.2500 mark that has acted as support on its own.
Daily chart
Read More: Technical Analysis
Traders go short
Before the central bank events, traders were 51% short, but pending orders in the 100 pip range around the pair were 51% to sell.
After the Fed events, traders were 54% short and orders were 51% to sell. It appears that some traders expect a retracement downwards.
On Friday, traders were 61% short, as a decline was expected. Meanwhile, pending orders were 52% to sell.
Before the central bank events, traders were 51% short, but pending orders in the 100 pip range around the pair were 51% to sell.
After the Fed events, traders were 54% short and orders were 51% to sell. It appears that some traders expect a retracement downwards.
On Friday, traders were 61% short, as a decline was expected. Meanwhile, pending orders were 52% to sell.