GBP/USD Edges Lower to 1.3742 to Trim Weekly Gains After Mixed UK Data

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The GBP/USD currency pair on Friday edged lower to trade around 1.3742 down from this week’s highs of 1.3785 after mixed UK data. The currency pair continues to trade within a descending channel formation in the 60-min chart. 

Friday’s pullback prevented the pair from advancing to overbought conditions in the 14-hour RSI. The currency pair continues to trade above the 100-hour moving average following Thursday’s gains.

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 Friday, the preliminary UK Markit Manufacturing PMI for July missed the expectation of 62.5 with 60.4. The Services PMI also came short of 62 with 57.8 while the Gfk consumer confidence for  July beat -8 with -7. On the other hand, the UK retail sales ex-fuel for June missed the (YoY) expectation of 8.2% with a change of 7.4%. The (MoM) equivalent also came short of 0.6% with 0.3%. General retails sales came in better than expected.

In the US, the preliminary Markit Manufacturing PMI for July beat the expectation of 62 with 63.1 while the Services PMI missed 64.8 with 59.8. Earlier in the week, the US initial jobless claims for July 16 missed the expectation of 350k with 419k while continuing claims came in higher than expected with a tally of 3.236 million versus 3.1 million. Building permits for June also came short of expectations while housing starts outperformed.

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

Technically, the GBP/USD currency pair appears to be trading within a descending channel formation in the 60-min chart. The pair pulled back on Friday to avoid reaching overbought conditions following Thursday’s rally.

The bulls will be looking to extend the current bull run towards 1.3814 or higher to 1.3884. On the other hand, the bears will target pullback profits at around 1.3669 or lower at 1.3596.

GBP/USD Technical Analysis (the Daily Chart)

In the daily chart, the GBP/USD currency pair appears to have recently pulled back after a significant rally. The pair now trades just above the 23.60% fib level on the way down. The recent rebound prevented the currency pair from falling to oversold conditions in the 14-day RSI.

The bears will be looking to extend the current pullbacks towards 1.3447 or lower to the 38.20% fib level at 1.3176. On the other hand, the bulls will target profits at 1.3986 or higher at the 0.00% fib level at 1.4251.

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