- 51% of pending orders in the 100-pip range are to sell
- 60% of traders are bullish on the Pound
- Important resistance lies near 1.3306
- Upcoming events: UK Services PMI, ADP Non-Farm Employment Change, ISM Non-Manufacturing PMI, Fed Chair Yellen to speak
The GBP/USD fell from the intraday high after the report on Tuesday indicated contraction in the UK construction sector. The Sterling lost 29 base points or 0.22% to continue losing ground, finishing the trading session near the 1.3249 mark. Though, the currency pair jumped back to the 1.3260 area this morning.
The GBP/USD fell from the intraday high after the report on Tuesday indicated contraction in the UK construction sector.
Fed Chair Yellen to speak at 1915GMT
This trading session is to start with the British Services PMI published at 0830GMT. Meanwhile, the US is to release ADP Non-Farm Employment Change and ISM Non-Manufacturing PMI at 1215GMT and 1400GMT, respectively. Finally, the Federal Reserve Chair Janet Yellen is to deliver opening remarks at a community banking conference at 1915GMT.
GBP/USD stays in senior channel
In line with expectations, the currency exchange rate failed to break from the one-month-long descending channel yesterday. Accordingly, it formed a third reaction low and continued to move in the opposite direction. However, it seems that the 55-hour SMA is not going to allow the Pound to gain more value against the Dollar, as it did many other times in the past.
On the other hand, if a released data on the UK Services PMI will appear to be better than expected, this barrier is unlikely to withhold pressure from bulls. An additional impulse for surge or, in contrast, for downfall is also expected to be provided by an update on the US employment as well as the Fed Chair Yellen speech.
Regardless of outcome, there is a good chance that the pair will manage to stay within the pattern.
Hourly chart
In general, the Pound has not change its positioning against the US Dollar early on Wednesday, as it still remains confined between the weekly S1 and S2 in the 1.2206/1.3211. The upside is likewise restricted by the monthly PP at 1.3322. The rate has moved below the 20-day SMA; thus, it could be expected that it tries to approach the lower Bollinger band circa 1.3070 during this week.
Daily chart
Market sentiment at balance
SWFX market sentiment is bullish on Wednesday, as the number of long positions is 60%, compared to 53% on Tuesday. In addition, 56% of pending orders are to buy the Pound (+2%).
Meanwhile, OANDA traders remain bearish on the Pound, as 55% of open positions are short (-3%). Traders at Saxo Bank are likewise bearish with 63% short positions (+1%).