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The Pound has had little to offer these days, confined to a 100 pips' range amid poor UK growth figures. Dollar weakness helping it bounce.
1. Technical Overview
he very short-term technical indicators on the 1-hour chart point to a further potential on the downside for GBP/USD from here. Momentum and the Relative Strength Index have both turned lower on 1-hour chart and Moving Averages of 50 and 21 periods formed the Beashish crossover along with Bearish crossover on Slow Stochastic. While GBP/USD is trading below 1.4000, break of 1.3960 is needed for the Bearish trend to prevail targeting 1.3740 level.
2. Fundamental Overview
After the GBP/USD saw construction PMI falling into the negative territory on Wednesday coupled with services PMI falling sharply lower on Thursday, the story of holding onto parallel upward sloping channel is over especially as the US Non-Farm Payroll report is set to deliver the decisive impulse on the FX market this afternoon.
Once GBP/USD broke below 1.4000 trading at 1.3980 on Friday morning, the next technical hurdle to overcome is 1.3960 level representing 23.6% Fibonacci retracement of GBP/USD long-term uptrend from 1.2770 to 1.4340 high. The currency pair is now moving within downward sloping channel starting at the peak of 1.4245 in late March and pointing downwards.
Breaking 1.3966 opens the way for Sterling to test 1.3740 level, representing the next Fibonacci retracement hurdle.
The fundamental weakness of Sterling is given by slowdown in the economic indicators including forward-looking PMI surveys. While the UK manufacturing PMI marked slight month-to-month increase with PMI rising to 55.1 in March from a downwardly revised reading of 55.0 in February on Tuesday, the construction PMI slumped to negative territory in March with headline PMI falling to 47.0 level indicating economic contraction. The UK services PMI fell to the lowest level in 20-months of 51.7 in March missing the forecast of 54.0 reading.
Given the fundamental weakness of the UK indicators, it is only the prospects of escalating trade wars between the US and China that kept Sterling above 1.4000 level at the beginning of this week headlined by the US employment report due this afternoon. The forerunner of the government's labor market report was published on Wednesday with ADP private employment report showing 241K new jobs were added in the US in March, beating the analyst's forecast.
source fxstreet
1. Technical Overview
he very short-term technical indicators on the 1-hour chart point to a further potential on the downside for GBP/USD from here. Momentum and the Relative Strength Index have both turned lower on 1-hour chart and Moving Averages of 50 and 21 periods formed the Beashish crossover along with Bearish crossover on Slow Stochastic. While GBP/USD is trading below 1.4000, break of 1.3960 is needed for the Bearish trend to prevail targeting 1.3740 level.
2. Fundamental Overview
After the GBP/USD saw construction PMI falling into the negative territory on Wednesday coupled with services PMI falling sharply lower on Thursday, the story of holding onto parallel upward sloping channel is over especially as the US Non-Farm Payroll report is set to deliver the decisive impulse on the FX market this afternoon.
Once GBP/USD broke below 1.4000 trading at 1.3980 on Friday morning, the next technical hurdle to overcome is 1.3960 level representing 23.6% Fibonacci retracement of GBP/USD long-term uptrend from 1.2770 to 1.4340 high. The currency pair is now moving within downward sloping channel starting at the peak of 1.4245 in late March and pointing downwards.
Breaking 1.3966 opens the way for Sterling to test 1.3740 level, representing the next Fibonacci retracement hurdle.
The fundamental weakness of Sterling is given by slowdown in the economic indicators including forward-looking PMI surveys. While the UK manufacturing PMI marked slight month-to-month increase with PMI rising to 55.1 in March from a downwardly revised reading of 55.0 in February on Tuesday, the construction PMI slumped to negative territory in March with headline PMI falling to 47.0 level indicating economic contraction. The UK services PMI fell to the lowest level in 20-months of 51.7 in March missing the forecast of 54.0 reading.
Given the fundamental weakness of the UK indicators, it is only the prospects of escalating trade wars between the US and China that kept Sterling above 1.4000 level at the beginning of this week headlined by the US employment report due this afternoon. The forerunner of the government's labor market report was published on Wednesday with ADP private employment report showing 241K new jobs were added in the US in March, beating the analyst's forecast.
source fxstreet
