- 55% of pending orders in the 100-pip range are to BUY
- 55% of traders are bullish on the Pound (-3%)
- Important support lies circa 1.3140
- Upcoming events: UK Retail Sales m/m, US Unemployment Claims, US Import prices m/m, Philly Fed Manufacturing Index, US Capacity Utilisation Rate, US Industrial Production m/m, BOE Governor Carney and FOMC Members Kaplan and Brainard to speak
The Labour Department revealed that the US consumer inflation eased to 0.1% from 0.5% in October, while its core figure appreciated to 0.2% in the same period.
Relatively strong readings pointed to the end of disinflationary trend, which worried the Fed the most. The report also showed a little slowdown in retail sales growth pace, though stronger consumers spending, including higher real wages and job gains are expected to encourage retailing in the next months.
Both UK and US in focus
Several fundamental events should be noted in this session. The day will start with the British Retail Sales for October at 0930GMT. The United States is to publish its weekly Unemployment Claims, monthly Import Prices and the Philadelphia Fed Manufacturing Index at 1330GMT, as well as its Capacity Utilisation Rate and Industrial Production for October at 1415GMT.
Meanwhile, three speeches are scheduled for today. The BOE Governor Mark Carney is set to speak along with Monetary Policy Committee members Ben Broadbent, Jon Cunliffe, and David Ramsden about economics at various public schools in Liverpool. In addition, the Federal Reserve Governor Lael Brainard will speak about financial technology at the Third Annual Financial Stability Conference at 2045GMT, while the President of the Federal Reserve Bank of Dallas Robert Kaplan is to participate at the Chartered Financial Analyst Society of Houston meeting; the time, however, is still tentative.
GBP/USD ready for another attempt to jump to 1.3230
As release of British employment data, generally, was perceived positively, the Pound expectedly climbed to the 1.3200 level. Nevertheless, a subsequent release of the American retail sales and inflation data neutralized this achievement by returning the pair back to combined support area formed by the 55-, 100- and 200- hour SMAs near the 1.3135 mark.
After making a rebound the cable resumed the surge. Second day in a row bulls are hoping to use macroeconomic data release to push the rate to the pre-fall 1.3230 level. Whether they succeed or not will mainly depend on the UK retail sales growth rate.
There just a need to take into account that the pair is unlikely to climb above a combination of the monthly PP and upper edge of dominant channel from the north and the above MAs from the south.
Hourly chart
As apparent on the chart, the Sterling has not yet changed its positioning against the US Dollar, as the rate keeps trading sideways for the second week. Despite high volatility, it closed Wednesday's trading session with slight gains above the weekly PP.
Conversely, bears prevailed on Thursday morning, thus pushing the rate towards the 100-hour SMA once again.
If looking at daily signals, a possible trading range for today could be the 1.31/32 territory.
Daily chart
Bears strengthen their positions
The bullish SWFX market sentiment has slightly weakened on Wednesday, as it is currently standing at 55% (-1%). In addition, 58% of pending orders are to buy the Sterling (+6%).
OANDA traders are bullish in this session, as 53% of open positions are long (-3%). Meanwhile, Saxo Bank clients have turned bearish on the pair, as 61% of their positions are short (+8%).