On Tuesday, the GBP/USD broke the resistance of the weekly R1 simple pivot point at 1.3923. Afterwards, the pair touched the 1.3950 mark before beginning a consolidation by retracing back down.
In the near term future, the currency exchange rate could look for support in the 55 and 100-hour simple moving averages.
Economic Calendar
The week is expected to have a lot of data releases, which could impact the currency exchange rate from both the GBP and USD sides.
On Wednesday morning, at 07:00 GMT the GBP/USD could move from 9.7 to 16.1 pips due to the release of the United Kingdom Consumer Price Index.
On the same day, at 13:30 GMT, the US Retail Sales and Core Retail Sales could cause a move of 10.3 to 26.3 pips, as it has done since September. However, at the same time, the US Producer Price Index and Core Producer Price Index are set to be published. This event has caused moves from 11.1 to 36.2 pips.
If both data sets reveal a positive or negative surprise, compared to the market forecast, the impact could be combined. On the other hand, the data could contradict one another and cancel out the effect of an impact.
Also on Wednesday, at 19:00 GMT the FOMC Meeting Minutes PDF document will be released. Note that the impact of the meeting minutes occurs slowly not suddenly, as the market participants read and interpret the meeting minutes.
On Thursday, market participants are set to watch the weekly US Unemployment Claims at 13:30 GMT. The rate has moved from 7.6 to 14.9 pips on the announcement since January 14.
On Friday morning, the UK Retail Sales data will be out at 07:00 GMT. The GBP/USD has moved from 6.4 to 20.6 pips on the announcement.
Friday will be the day that the Markit Purchasing Managers Indices are published. These survey results reveal what various sector purchasing managers are thinking about the future outlook of their respective sectors. In general, the markets look at the results of the services and manufacturing sectors.
The UK Services and Manufacturing PMIs are set to be published at 09:30 GMT. This event has caused moves from 13.0 to 26.7 pips since September.
The week will end for the GBP/USD with the US PMIs at 14:45 GMT. The release could cause a move from 7.8 to 30.5 pips.
Click on the link below to find out more about the data releases of this and other currency exchange rates.
GBP/USD short-term review
In the near term future, the rate was expected to look for support in the 55 and 100-hour simple moving averages.In the case of these levels providing support, the rate could once again surge and test the 1.3950 level. If this level gets passed, the rate might test first the weekly R2 simple pivot point at 1.3988 and afterwards the 1.4000 mark.
If the SMAs fail to push the rate up, the pair could decline as low as the weekly simple pivot point at 1.3802 and the 200-hour simple moving average.
Hourly Chart
On the daily candle chart, the pair has reached the upper trend line of the channel up pattern, which had guided the rate since September.
In regards to the future, the rate should trade sideways or retrace back down to consolidate its gains.
Daily chart
Read More: Technical Analysis
Traders are mostly short
Since Friday, 74% of trader open position volume on the Swiss Foreign Exchange was in short positions.
Meanwhile, in the 100-pip range around the rate the pending orders were 55% to sell the GBP/USD pair.
Since Friday, 74% of trader open position volume on the Swiss Foreign Exchange was in short positions.
Meanwhile, in the 100-pip range around the rate the pending orders were 55% to sell the GBP/USD pair.