The GBP/USD currency pair on Thursday pulled back off the session highs of about 1.2772 to trade at about 1.2711. The currency pair appears to have completed a downward breakout from an ascending channel formation.
The pair has now fallen to trade a few levels below the 100-hour moving average line. As a result, the currency pair appears to be moving closer to the 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 the US market. On Thursday, the US initial jobless claims for the week ending January 5 beat the expected claim count of 210k with a significantly lower tally of 202k. The continuing claims for the preceding week also outshone the forecasted tally of 1.871 million with a tally of 1.834 million.
The US consumer price index for December exceeded the (MoM) forecast of 0.2% with a change of 0.3%. The (YoY) equivalent also beat 3.2% with a change of 3.4%. On the other hand, the consumer price index ex-food and energy outshone the estimate of 3.8% with a change of 3.9% (YoY), while the (MoM) equivalent was in line with the forecast of 0.3%.
In the UK, the BRC like-for-like retail sales for December grew by 1.9% on a year-over-year basis, compared to a growth rate of 2.6% posted in the previous period. Traders will be looking forward to the UK, production data and the gross domestic product for November on Friday.
GBP/USD Technical Analysis (the 60-min Chart)
Technically, the GBP/USD currency pair appears to have recently completed a downward breakout from an ascending channel formation. The 14-hour RSI also seems to support a short-term bearish bias as it moves closer to oversold conditions.
Therefore, the bears will be targeting extended pullbacks at about 1.2685 or lower at 1.2653. On the other hand, the bulls will look to pounce on rebounds at about 1.2740 or higher at 1.2772.
GBP/USD Technical Analysis (the Daily Chart)
In the daily chart, the GBP/USD currency pair appears to be trading within an ascending channel formation. As a result, the 14-day RSI seems to have rallied closer to the overbought conditions.
Therefore, the bulls will be looking to ride the current run of gains toward 1.2830 or higher to 1.2937. On the other hand, the bears will look to pounce on pullbacks at about 1.2609 or lower at 1.2488.