- Retail sector is 65% bullish on the pair
- 58% of pending orders in the 100-pip range are set to sell
- Canadian retail and US oil data
It was expected that the GBP/USD will reach higher in the upcoming trading sessions. Instead the pair has jumped, quickly reaching above the 1.29 level. The surge has occurred in the borders of a narrow ascending pattern, which is not sustainable in the long term.
The Greenback weakened against the British Pound, following the United Kingdom Retail Sales release on Thursday at 08:30 GMT. The GBP/USD currency pair gained 20 pips, or 0.16%.
The Office for National Statistics released UK Retail Sales data that came better-than-expected at 0.7% with the forecasted of 0.2%. The actual data is good for the currency because there come more opportunities for the change in the total value of inflation-adjusted sales at the retail level.
The Office for National Statistics senior statistician, Rhian Murphy said: "Many consumers stayed away from some high street stores in July, but online sales were very strong, supported by several retailers launching promotions. Food sales remained robust as people continued to enjoy the World Cup and the sunshine."
Canadian Retail and US Crude Oil
The two first empty trading session of the week are over. Macroeconomic data will be once more released and cause sudden bounced in the financial markets. However, they will not influence the US Dollar.
At 12:30 GMT the Canadian Retail Sales will be published. This data release is expected to cause a widening of the trading range of 70 base points. The data release will be covered by Dukascopy Analytics on the bank's live webinar. The event will start at 12:20 GMT.
Moreover, there will be another notable data release occurring during the day. At 14:30 GMT the US Crude Oil Inventories data will be published. The data has caused fluctuations of at least 50 cents in oil prices throughout this summer. The release cover by Dukascopy Analytics will begin at 14:20 GMT.
GBP/USD meets resistance at weekly R2
The Sterling has strengthened significantly against the US Dollar since mid-Friday. This marks a 175-pip surge, with 107 pips being added on Tuesday. By this morning, the pair had managed to reach the weekly R2 at 1.2915. The monthly S1 is also located nearby.The Sterling has remained near this resistance cluster for some time now. It could point to a possible change in sentiment, thus resulting in a decline today.
The nearest support of importance is the weekly R1 and the 55-hour SMA near 1.2830; however, the trading range could be even wider in the wake of fundamental events later in the day. The pair is unlikely to fall below the 200-hour SMA, the monthly S2 and the weekly PP at 1.2750.
Hourly Chart
On the daily chart one can see that the surge has encountered the upper trend line of the dominant descending channel pattern. The patterns upper trend line is strengthened by the weekly R2 and the monthly S1.
Watch the trend line. If it gets passed the rate will first reach for the 1.30 mark and afterwards above the 1.31 level. If, it stands its ground, the decline of the Pound will resume.
Daily chart
The Swiss trader long sentiment remains intact, as 65% of open positions were long on Wednesday.
However, additional long positions are unlikely going to be open. Retail traders of the Swiss Foreign Exchange have set up 56% of all of their pending trade orders to sell.
Meanwhile, OANDA traders remain largely bullish, as 69% of open positions are long at the brokerage. In the meantime, traders at SAXO Bank are 63% long on the GBP/USD pair.
Spreads (avg, pip) / Trading volume / Volatility