Since June 20th, the GBP/USD has been trading between the support of the 1.2620 level and the resistance of the 1.2700 mark. On Monday, the pair appeared to be heading for another test of the 1.2700 mark.
In general, the sideways trading is attributed to the upcoming elections in the United Kingdom. The rate might remain near 1.2700 until Thursday.
Economic Calendar
Monday's top event was the US ISM Manufacturing PMI release at 14:00 GMT. The markets are taking in the data and adjusting to the reveal. Results are worse than expected, which is causing a decline of the US Dollar.
On Tuesday, at 14:00 GMT, the JOLTS Job Opening data will reveal how many jobs are available in the United States. The data will impact the markets through the value of the US Dollar.
Throughout Wednesday, there will be a number of releases that could cause a Dollar move. At 12:15 GMT ADP Non-Farm Employment Change will be published. At 12:30 GMT, the weekly Unemployment Claims might cause a move. At 14:00 GMT, the ISM Services PMI is set to be published. The day will end with the release of the US Federal Reserve Federal Open Markets Committee Meeting Minutes at 18:00 GMT.
On Friday, the top event of the week will take place. At 12:30 GMT, the United States employment data sets will be published. This release is most certainly going to create volatility.
GBP/USD hourly chart analysis
Before testing the resistance of the 1.2700 level, the rate could be slowed down at the 1.2692 level where the weekly R1 simple pivot point was located at. Higher above, resistance is located at 1.2740. This level has acted as resistance in mid-June. In addition, the round exchange rate level is strengthened by the weekly R2 simple pivot point at 1.2742.However, a potential decline of the rate is set to first look for support in the combination of the 50, 100 and 200-hour simple moving averages and the weekly simple pivot point all near the 1.2650 level. If the rate declines below 1.2650, then the 1.2620 might once again impact the pair.
Hourly Chart
GBP/USD daily candle chart analysis
We wrote at the start of the month: "The surge has reached the resistance of a long ago marked resistance zone. We investigated the range and found that certain levels act as resistance. Resistance is provided by the 1.2800, 1.2830, 1.2850 and 1.2900 levels. At these levels major reversals have happened that have started moves that lasted from a month up to a whole quarter.The GBP/USD could be at a major turning point. Due to this reason watch the ascending channel closely for potential breaking of it and the establishment of a new pattern."
Most recently, it could be observed that the reversal had occurred, but it has found support in the combination of the 50, 100 and 200-hour simple moving averages near 1.2650.
Read More: Technical Analysis
Traders are neutral
The Dukascopy open positions are neutral, as 51% of all open position volume was in long positions.
Meanwhile, pending orders in the 100-pip range around the rate were 57% to sell the pair.
Meanwhile, pending orders in the 100-pip range around the rate were 57% to sell the pair.