Since the middle of Thursday's trading session the GBP/USD has been making attempts to pass the resistance of the 55-hour simple moving average.
In general, the rate was expected to be pushed down as soon as the 100-hour simple moving average approaches and provides additional technical resistance.
Institute for Supply Management released the US Non-Manufacturing PMI data, which came out worse-than-expected of 53.7 compared with the forecast of 55.5.
Anthony Nieves, Chair of the Institute for Supply Management (ISM) Non-Manufacturing Business Survey Committee commented: "The NMI registered 53.7 percent, which is 1.4 percentage points lower than the June reading of 55.1 percent. This represents continued growth in the non-manufacturing sector, at a slower rate. This is the index's lowest reading since August 2016, when it registered 51.8 percent. Respondents indicated ongoing concerns related to tariffs and employment resources. Comments remained mixed about business conditions and the overall economy."
UK economic data
On Friday, three data releases from the UK are expected at 8:30 GMT.
The first one is the UK GDP data release. The previous data release caused a nine-pip move.
The UK Manufacturing Production and Prelim GDP data releases will follow.
GBP/USD short-term review
During the previous trading session, the GBP/USD exchange rate traded sideways around the psychological level at 1.2160. During Tuesday's morning, the rate surpassed the given level.Note, that the currency pair is trading near the upper boundary of the short-term ascending channel at 1.2200. Thus, from a theoretical perspective, it is likely, that a reversal south could occur soon. In this case, the pair could face the support of the 55– and 100-hour SMAs, located circa 1.2146.
On the other hand, the pair could try to surpass the resistance level formed by the weekly PP at the 1.2212 mark. It is unlikely, that the British Pound could exceed 1.2236 against the US Dollar due to the resistance of the 200-hour SMA.
Hourly Chart
A review of the daily candle chart has revealed that the rate has been in a smaller scale descending channel pattern that represents the rate's sharper decline, which began at the start of May.
The pattern's lower trend line is strengthening the support of the 1.2100 level.
Daily chart
Meanwhile, trader set up pending orders in the 100-pip range were bearish, as 37% of orders were set to buy and 64% were to sell.