On Thursday, the GBP/USD currency pair pulled back from the session highs of about 1.2659 to trade at about 1.2628. The currency pair trades within a descending channel formation in the 60-minute chart.
The pair has now descended to trade a few levels 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 U.K. market. On Wednesday, the U.K.’s consumer price index for October outperformed the expected (MoM) change of 0.5% with a change of 0.6%. The (YoY) equivalent also beat the forecast of 2.2% with a change of 2.3%. The core personal consumer price index for the period outshone the expectation of 3.1% with a change of 3.3%.
On the other hand, the non-seasonally adjusted producer price output for the month beat both the (MoM) and (YoY) forecasts of -0.1% and -0.9%, respectively with changes of 0% and -0.8%. The retail price index for October matched the forecasts of 0.5% (MoM) and 3.4% (YoY).
In the U.S., the building permits for October missed the expectation of 1.43 million with a tally of -0.6 million, down from 1.425 million in September. The housing starts for the month also fell short of the forecasted tally of 1.33 million with a tally of 1.311 million down from the preceding month’s equivalent of 1.353 million. Traders will be looking forward to the U.S. initial jobless claims data on Thursday, ahead of the preliminary S&P Global Manufacturing, Services and Composite PMIs for November on Friday.
GBP/USD Technical Analysis (the 60-min Chart)
Technically, the GBP/USD currency pair trades within a descending channel formation in the 60-minute chart. The 14-hour RSI has also pulled back to move closer to the oversold conditions.
Therefore, the bears will look to extend the current pullback towards 1.2595 or lower to 1.2558. On the other hand, the bulls will look to pounce on rebounds at about 1.2659 or higher at 1.2693.
GBP/USD Technical Analysis (the Daily Chart)
In the daily chart, the GBP/USD currency pair trades within a sharply descending channel formation. The 14-hour RSI also seems to be on the verge of entering oversold conditions after extended declines.
Therefore, the bears will look to ride the current decline towards 1.2476 or lower to 1.2337. On the other hand, the bulls will look to pounce on profits at about 1.2761 or higher at 1.2895.