On Wednesday, the GBP/USD currency pair extended Tuesday’s pullback from the current week’s high of 1.3286 to trade at 1.3219. The currency pair trades within a sideways channel formation on the 60-minute chart.
The pair has now fallen to trade slightly below the 100-hour moving average line. As a result, the currency pair is on the verge of entering the oversold levels of the 14-hour RSI.
GBP/USD Fundamentals Overview
From a fundamental perspective, the GBP/USD currency pair trades during a relatively busy period in the US market. On Tuesday, the US average for the 4-week ADP employment change improved to 23.75k, up from the previous update of 22.5k.
On Monday, the US ISM Services PMI for September missed the forecast reading of 55, with a reading of 54.9, down from the previous month’s equivalent of 55.4.
On the other hand, the ISM Services Prices Paid for the period edged higher to 74, up from 72.6 in August. The ISM Services Employment Index for the month improved to 50.1, up from 47.8. The ISM Services New Orders Index fell to 59.8, down from 60.9. The S&P Global Composite PMI for September remained unchanged at 58.4, in line with expectations.
Looking forward, traders will be waiting for the US initial jobless claims data for last week on Thursday, ahead of the preliminary Michigan Consumer Sentiment Index for October on Friday.
GBP/USD Technical Analysis (the 60-min Chart)
Technically, the GBP/USD currency pair trades within a sideways channel formation on the 60-minute chart. However, the 14-hour RSI has recently pulled back to move closer to oversold conditions.
Therefore, the bears will look to stretch the current pullback towards 1.3186 or lower, to 1.3151. On the other hand, the bulls will look to pounce on rebounds at about 1.3253 or higher, at 1.3286.
GBP/USD Technical Analysis (the Daily Chart)
In the daily chart, the GBP/USD currency pair trades within a descending channel formation. However, the 14-day RSI has recently bounced back to avoid falling into oversold conditions.
Therefore, the bulls will look to extend the current rebound towards 1.3341 or higher, to 1.3467. On the other hand, the bears will look to pounce on extended declines at about 1.3092 or lower, down to 1.2967.