The GBP/USD currency pair on Thursday pulled back off the session highs of about 1.2800 to trade at about 1.2750. The currency pair continues to trade within a descending channel formation in the 60-minute chart.
The pair has now plummeted to trade at the 100-hour moving average line. As a result, the currency pair appears to be 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 is trading at the back of a relatively busy period in both markets. On Thursday, the US initial jobless claims for the week ending June 7 missed the expected claim count of 225k with a significantly higher tally of 242k. The continuing claims for the preceding week also fell short of 1.8 million with a tally of 1.82 million.
The producer price index for May fell short of the forecasted (MoM) and (YoY) changes of 0.1% and 2.5%, respectively with changes of -0.2% and 2.2%. On the other hand, the producer price index ex-food and energy for the period missed the expected (MoM) change of 0.3% with a change of 0%, while the (YoY) equivalent failed to match the forecast of 2.4% with a change of 2.3%.
In the UK, manufacturing production for April missed the (MoM) expectation of -0.2% with a change of -1.4%. The (YoY) equivalent also fell short of 1.6% with a change of 0.4%. On the other hand, the UK industrial production for April missed both the (MoM) and (YoY) expectations of -0.1% and 0.3%, respectively with changes of -0.9% and -0.4%, while the gross domestic product for the month was in line with the (MoM) estimate of 0%.
GBP/USD Technical Analysis (the 60-min Chart)
Technically, the GBP/USD currency pair is trading within a descending channel formation in the 60-minute chart. The 14-hour RSI has also fallen to trade closer to the oversold conditions.
Therefore, the bears will be targeting extended pullbacks at about 1.2731 or lower at 1.2711. On the other hand, the bulls will be targeting potential rebounds at about 1.2766 or higher at 1.2784.
GBP/USD Technical Analysis (the Daily Chart)
In the daily chart, the GBP/USD currency pair is trading within an ascending channel formation. The 14-day RSI also seems to support a bullish bias as it moves closer to overbought conditions.
Therefore, the bulls will be looking to ride the current rally towards 1.2804 or higher to 1.2862. On the other hand, the bears will look to pounce on pullbacks at about 1.2691 or lower at 1.2629.