On Wednesday, the GBP/USD currency exchange rate recovered, as better than expected Purchasing Managers Index results were published. The recovery eventually reached the resistance of the 55-hour simple moving average, which kept the rate down.
On Thursday morning, the pair traded between the support of the 1.2700 level and the 55-hour SMA at 1.2745.
Economic Calendar
On Thursday, as accustomed, at 12:30 GMT, the US weekly Unemployment Claims could cause a move.
The week will end with a possible minor move from the US Durable Goods Orders at 12:30 GMT. The GBP/USD has barely moved during this event.
Click on the link below to see the historical reaction tables.
GBP/USD short-term review
In the near term future, the rate was expected to get squeezed in between the resistance of the 55-hour SMA and the support of the 1.2700 level, which is strengthened by the 61.80% Fibonacci retracement level. In addition, the rate has additional support of the pivot points at 1.2688 and 1.2675.In general, the pair should trade sideways until a break out occurs. Meanwhile, the rate could be pushed down by an announcement of new coronavirus measures in the UK or its impact on the economy. In this case, the rate would start a decline immediately.
Any kind of decline could find support in the 1.2600 mark and the weekly S3 simple pivot point at 1.2570.
On the other hand, if the pair breaks out of the squeeze to the upside, it would aim at the resistance of the pivot point at 1.2797, the 1.2800 level and the 100-hour SMA, which was located near 1.2815.
Hourly Chart
On the daily candle chart, the rate has pierced the support of the 100 and 200-day simple moving averages. If the rate declines below them, the SMAs should start to provide resistance.
Daily chart
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Traders remain long
Since Tuesday, 57% of trader open position volume on the Swiss Foreign Exchange was in long positions.
These traders had not taken profits during the recent retracement back up.
Meanwhile, in the 100-pip range around the rate the pending orders were 55% to sell the GBP/USD pair.
Previously, the orders were 51% to sell.
These traders had not taken profits during the recent retracement back up.
Meanwhile, in the 100-pip range around the rate the pending orders were 55% to sell the GBP/USD pair.
Previously, the orders were 51% to sell.