- Retail sector is 68% bullish on the pair
- 68% of pending orders in the 100-pip range are set to sell
- No more UK releases this week
On Thursday morning, the Pound made a short lived attempt to surge against the US Dollar. However, the pair had already managed to book a new low level on Wednesday.
The Greenback strengthened against the British Pound, following the United Kingdom Consumer Price Index release on Wednesday at 08:30 GMT. The GBP/USD currency pair lost 11 pips, or 0.08%. Right after the data release the main currency pair had a significant downtrend, but luckily, the main currency pair recovered itself to continue fluctuating in the 1.2710 area.
The Office for National Statistics released Consumer Price Index data that came in line with expectation of 2.5%. This is considered the UK's most important inflation data because it's used as the central bank's inflation target, which means that it is important for traders to follow this data to stay aware of currency valuation because rising prices lead the central bank to raise interest rates.
The senior economist at the Institute of Directors, Tej Parikh, said: "For households this isn't good news, as the already weak growth in their pay packets is being further eroded by high prices. This is likely to weigh down consumer spending, posing fresh problems for embattled high street businesses ".
Minor US data incoming
UK data releases for the week are over. Meanwhile, note that minor US data being released at 12:30 GMT might influence the currency exchange rate.
The event's cover will begin at 12:20 GMT on the Dukascopy live webinar platform.
GBP/USD remains steady
The Sterling has remained relatively unchanged against the US Dollar since the beginning of this week. It seems that the pair tried to edge higher during this time, but it was stopped by the 55– and 100-hour SMAs.At the time of this analysis, the Pound was fluctuating around the 1.27 level slightly below these moving averages. Technical indicators remain bullish; thus, a breakout could finally happen today. The following upward target after this breakout is the breached senior channel and the 200-hour and 200-period (4H) SMAs circa 1.2850.
It is unlikely that the pair extends its losses below the weekly S1 at 1.2650 in this session. Thus, even if the aforementioned breakout to the upside does not occur, the pair is expected to continue consolidating with a slight tendency southwards.
Hourly Chart
Once more the daily chart shows that the supposed surges of the GBP/USD are actually just short lived pauses in the borders of a large scale descending pattern. The currency exchange rate's decline is highly likely going to find short term support in the various monthly and weekly pivot point levels.
Daily chart
On Thursday, 68% of trader open positions on the Swiss Foreign Exchange were long. Previously 65% of positions were long.
However, additional long positions are unlikely going to be open. Retail traders of the Swiss Foreign Exchange have set up 63% of all of their pending trade orders to sell.
Meanwhile, OANDA traders remain largely bullish, as 67% of open positions are long at the brokerage. In the meantime, traders at SAXO Bank are 63% long on the GBP/USD pair.
It can be deducted from all of the sentiment information that not only the short term traders, but also long term positions are long. The market participants might be expecting a surge after the recent decline. However, during the recent trading sessions all of the open long positions have created only losses.
Spreads (avg, pip) / Trading volume / Volatility