GBP/USD Bounces Off 8-Week Lows To Trim Weekly Losses

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The GBP/USD currency pair on Friday bounced off the current 8-week lows to top 1.2740 following the latest round of UK and US data. The currency pair continues to trade within a descending triangle formation in the 60-min chart. 

It is now pinned just beneath the 100-hour SMA line while the 200-hour SMA is a few levels higher. Friday’s rebound prevented the currency pair from crossing to oversold levels of the 14-hour RSI. 

GBP/USD Fundamentals Overview

From a fundamental perspective, the GBP/USD currency pair is trading at the back of a relatively busy period in both markets. On Thursday, the Gfk Consumer Confidence Index for September beat the expected level of -27 with -25. The CBI distributive trades survey for September realized a change of 11%compared to the expected (MoM) change of -10%. Earlier in the week, the UK preliminary Markit Manufacturing PMI for September matched the expectation of 54.3. On the other hand, the Services PMI missed 56 with 55.1.

In the US, earlier in the week existing home sales and home sales change for August matched the (MoM) expectations of 6M and 2.4%, respectively. On Wednesday, the preliminary Markit Manufacturing PMI for September beat 53.2 with 53.5 while the Services PMI missed 54.7 with 54.6. Thursday, the initial and continuing jobless claims slightly missed expectations. On the other hand, new home sales and home sales change beat estimates. On Friday, durable goods orders missed the expectation of 1.5% with 0.4% while nondefense capital goods orders ex-aircraft outperformed 0.5% with 1.8%. 

GBP/USD Technical Analysis (the 60-min Chart)

Technically, the GBP/USD currency pair appears to be trading within a descending triangle formation in the 60-min chart. This indicates a strong short-term bearish bias in the market sentiment.

The bears will be looking to extend the current declines towards 1.2690 or lower at 1.2615. On the other hand, the bulls will target short-term rebound profits at around 1.2795 or higher at 1.2868.

GBP/USD Technical Analysis (the Daily Chart)

In the daily chart, the GBP?USD currency pair appears to have recently made a bearish breakout from an ascending channel formation. This indicates an attempt by the bears to take control of the market in the long-term. 

They will be targeting long-term profits at around 50% and 38.20% Fib levels at 1.2464 and 1.2223, respectively. On the other hand, the bulls will target long-term profits at around 76.40% Fib level at 1.3019 or higher at 1.3272.

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