- 56% of pending orders in the 100-pip range are to SELL
- Traders have become bullish with 55% long positions (+4%)
- Downside potential until 1.3830
- Minor fundamentals scheduled for today
The Sterling depreciated against the US Dollar, following the release of factory output data on Friday. The GBP/USD exchange rate lost seven pips, or 0.05%, reaching the 1.3805 level.
The UK industrial output did not meet the forecasts in the month of January, growing only by 0.1%, following a little bit higher growth rate of 0.3% in the prior month. While the uptick may not be flattering, the UK Office for National Statistics still reported the ninth consecutive month of growth in domestic manufacturing companies, which means that the gain in January marks the longest growth streak since the beginning of ONS records in 1968.
Minor data
The economic calendar for this trading includes several fundamental events of minor importance, such as the US 10-y Bond Auction and the Federal Budget Balance at 1701GMT and 1800GMT, respectively.
GBP/USD stranded between strong barriers
A retracement from the breached one-month channel was followed by a surge up to the 1.3865 mark. Bulls were reluctant to continue this advance even further due to the strong resistance of the 55– and 100-hour SMAs and the monthly and weekly pivot points.Technical indicators suggest that bears could take advantage of this situation and thus force the rate lower today. This movement, however, could be very limited, as the 200-hour SMA is located nearby. In case this line is breached, the next downside target is the 1.38 mark.
By and large, the general tendency of the Pound, which is expected to prevail in the market this week as well, is upwards. Thus, traders are likely to see appreciation towards a trend-line or the weekly R1 at 1.3910 and 1.3940, respectively, during the first part of the week.
Hourly chart
The GBP/USD currency pair was moving along the 55-day SMA during the previous week. The Pound, however, failed to surpass the 1.40 mark, thus diminishing its trading range.
Even though some upward momentum might still follow this week, it seems that the pair is ready to breach the aforementioned moving average decline down to the bottom boundary of the senior channel located near 1.3650.
Daily Chart
The market sentiment of SWFX traders is bullish with 55% of open positions being long (+4%). Meanwhile, 55% of pending orders are still to sell the Sterling (+1%).
The market sentiment of OANDA traders has once again turned neutral, compared to 53% short positions on Friday. Conversely, Saxo Bank clients are increasingly bearish with 57% of short positions (+3%).
Spreads (avg, pip) / Trading volume / Volatility