The GBP/USD traders are waiting for the UK's Parliament vote on the Brexit deal that Theresa May has arranged with the EU.
The time of the vote has not been established, as there will be a debate prior to the vote. Meanwhile, you can read up more on the event in the article section of Dukascopy Bank SA.
The British Pound appreciated against the US Dollar, following the UK GDP data release on Friday at 09:30 GMT. The GBP/USD exchange currency rate gained 6 pips or 0.05% during a minute, right after the release. The British Pound continued trading at the 1.2765 area against the US Dollar.
Rob Kent-Smith, the head of national accounts at the Office for National Statistics revealed, "Growth in the UK economy continued to slow in the three months to November 2018 after performing more strongly through the middle of the year. Accountancy and housebuilding again grew but a number of other areas were sluggish,"
All attention on Brexit
Fundamental data traders will mostly pay attention this week to the Brexit vote at the UK's Parliament. Meanwhile, macro release traders will still have events to watch and trade.On Tuesday, at 13:30 GMT the US Producers Price Index will be published. The release will be covered mainly due to Dukascopy Analytics sticking to the rule – If it causes 10 pips, we over it.
US PPI causes mostly just above ten pip moves. Enough to trigger a trailing stop loss, but not enough to actually change a strategy.
On the same day note that the ECB President Draghi will testify before the European Parliament in Strasbourg. Some of his comments might cause an increase of volatility in the EUR pairs.
On Wednesday, at 09:15 action will begin in the UK. Namely, at that time the Bank of England Governor Carney will report to the UK treasury about his actions. Most likely he will report how he dealt with Brexit volatility and lay out the bank's future scenario in regards to the results of the Parliament vote on Tuesday.
Simultaneously to the reporting of Carney, the UK CPI will be published. This data release usually causes moves of around 20 base points. However, this time Dukascopy Analytics expect all attention to be taken away by the Carney's report.
Besides a speech at the G20 Meetings by Bank of Japan's Governor Kuroda at 03:20 GMT, there is nothing on Thursday to watch.
On Friday, two data releases will be covered by Dukascopy Analytics.
At 09:30 GMT the UK Retail Sales will be published. Around 10-40 base point move can be expected during the event.
The biggest event of the will occur at 13:30. The Canadian CPI will be published. On the USD/CAD there are 30 pip moves even when it hits the forecast. When the data is different there have been 40-85 pip moves.
GBP/USD short term review
During Monday morning hours, the 62.20% Fibonacci retracement level at 1.2867 retraced the rate to the 1.2835 mark.In regards to the near-term future, most likely, that the British Pound will get appreciated against the US Dollar to break the resistance level of the 62.20% Fibo to trade at the 1.2900 level. Moreover, the 55-hour and the 100-hour SMAs will support the rate during the trading session.
However, the GBP/USD could keep trading sideways between the 62.20% Fibo and the weekly PP due to a lack of any significant fundamental news which could affect the rate during the day!
Hourly Chart
The previously described waiting mode is over. The comments provided by the Brexit funders on Friday to Reuters provided the needed strength to push through the 1.2800 mark.
In general expect more such moves that can't be forecast. Meanwhile, watch closely each speaker, as all of them have an agenda. It might be even possible that the comment was provided in an effort to profit from the sudden jump that would occur during the publication of the news.
Daily chart
Meanwhile, trader set up pending orders in the 100-base point range were set to sell the pair in 62% of cases.
In general, it could be seen that although the long positions dominated, pending sell orders were set up to take advantage of a sudden decline.