GBP/USD Price Level Is Weak Follow-up, Focus on the US GDP
- The GBP/USD pair is now trading just below key resistance.
- A comeback was natural after the previous decline.
- The statistics from the United States should be crucial tomorrow.
The GBP/USD exchange rate fell in the short term, and it was trading at 1.2308 at the time of writing. Following such rapid expansion, a reversal is likely.
Fundamentally, the USD was helped in yesterday's trading session by the US CB Consumer Confidence. The economic indicator was 104.2 points, up from 101.0 points predicted and higher than 103.4 points in the preceding reporting period.
The United Kingdom released mixed data today. Net Lending to People and M4 Money Supply were lower than projected, while Mortgage Approvals were lower than anticipated. Eventually, the FPC Meeting Minutes and FPC Announcement may cause the price to fluctuate.
In contrast, the US Pending House Sales might fall by 2.9% compared to the 8.1% increase in the previous reporting period.
Because the United States will disclose significant data tomorrow, the fundamentals should take the lead and move the rate. Final GDP may expand by 2.7%, while Unemployment Claims are projected to be 196K in the previous week. Good US statistics should help the dollar.
From a technical standpoint, the GBP/USD pair has formed a probable Rising Wedge pattern. This is referred to as a reversal formation. Yet, the price failed to consolidate below the psychological barrier of 1.2200, indicating that sellers were fatigued.
Following the last sell-off, the GBP/USD pair was predicted to recover to the broken uptrend line. As shown on the hourly chart, the price failed to test the broken dynamic support and has now hit the previous high of 1.2343, which serves as a static resistance.
Failure to stay above the weekly R1 (1.2330) may signal the end of the up leg, and the sellers may seize complete control. The most recent bullish momentum might be a flag pattern. Yet, a successful breach through 1.2343 initiates additional growth and renders the bearish scenario worthless.