GBP/USD Focus: UK Data Impact
מעודכן
GBP/USD struggled to sustain its winning streak, trading around 1.2160 in Monday's Asian session. However, the currency pair faced resistance after the optimistic release of the UK Retail Sales data for September last Friday. GBP/USD started to trend higher after testing the 1.2100 level, but the Relative Strength Index (RSI) on the 4-hour chart remains below 50, indicating the downward trend persists. If the pair closes below 1.2100 within the 4-hour timeframe, sellers might take action. In this scenario, 1.2050 (the recent low point) could be the next downward target before 1.2000 (a psychological level, a point of stability).
On the upside, the 20-period Simple Moving Average (SMA) is forming dynamic resistance at 1.2150, followed by 1.2180 (SMA 100) and 1.2200 (the 23.6% Fibonacci retracement level of the recent downward trend). GBP/USD faced renewed selling pressure and dropped to the 1.2100 area before a modest recovery in the European trading session. Short-term technical outlook indicates the ongoing downward trend.
UK Retail Sales declined by 0.9% compared to the previous month in September, the Office for National Statistics reported last Friday. This data was weaker than the market's forecast of a 0.1% decrease, weighing on the British Pound.
Meanwhile, Bank of England Governor Andrew Bailey stated to Belfast Telegraph that he expects inflation to "subside markedly" next month. "Assessing the September inflation data, core inflation was slightly lower than what we expected, which is quite encouraging," Bailey added, complicating GBP/USD's recovery momentum.
On Thursday, the US Dollar lost momentum after Federal Reserve Chair Jerome Powell mentioned that significantly tightening financial conditions along with higher bond yields could impact the policy. However, the increased negative risk sentiment helped the USD find footing on Friday despite Powell's cautious tone. Rising concerns about further escalation in the Israel-Hamas conflict over the weekend might steer investors away from risk-sensitive assets on the final trading day of the week, allowing the USD to stand firm against its counterparts. Stay tuned for updates as the market dynamics continue to unfold.
On the upside, the 20-period Simple Moving Average (SMA) is forming dynamic resistance at 1.2150, followed by 1.2180 (SMA 100) and 1.2200 (the 23.6% Fibonacci retracement level of the recent downward trend). GBP/USD faced renewed selling pressure and dropped to the 1.2100 area before a modest recovery in the European trading session. Short-term technical outlook indicates the ongoing downward trend.
UK Retail Sales declined by 0.9% compared to the previous month in September, the Office for National Statistics reported last Friday. This data was weaker than the market's forecast of a 0.1% decrease, weighing on the British Pound.
Meanwhile, Bank of England Governor Andrew Bailey stated to Belfast Telegraph that he expects inflation to "subside markedly" next month. "Assessing the September inflation data, core inflation was slightly lower than what we expected, which is quite encouraging," Bailey added, complicating GBP/USD's recovery momentum.
On Thursday, the US Dollar lost momentum after Federal Reserve Chair Jerome Powell mentioned that significantly tightening financial conditions along with higher bond yields could impact the policy. However, the increased negative risk sentiment helped the USD find footing on Friday despite Powell's cautious tone. Rising concerns about further escalation in the Israel-Hamas conflict over the weekend might steer investors away from risk-sensitive assets on the final trading day of the week, allowing the USD to stand firm against its counterparts. Stay tuned for updates as the market dynamics continue to unfold.
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