The GBP/USD currency pair on Wednesday continued to form a consolidative sideways pattern. The pound held firm ahead of US data. The currency pair has been on an upward movement over the last two weeks.
The pair bottomed at around 1.1424 during the third week of March and has since gone on to top 1.2519. It remains relatively central on the 60-min RSI above the 100-hour SMA. The 200-hour SMA is several pips below.
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 market. In the latest round of economic data, the US ISM Manufacturing data come out better than expected with 49.1 versus 45. However, the Markit Manufacturing PMI was slightly short of expectations with 48.5 versus 49.2.
The ISM Manufacturing Prices Paid missed 41.2 with 37.4 while the ISM Manufacturing New Orders Index of 42.2 was below the estimate of 50.2. The ADP Employment change beat the expectation of -152k with -27k while the ISM Manufacturing Employment Index of 43.8 was better than the expectation of 43.6.
In the UK, the GDP matched the (QoQ) forecast of 0.0% growth. The Markit Manufacturing PMI for March was slightly better than expected with 47.8 versus 47. On the other hand, the Gfk Consumer Confidence Index came in better than expected with -9 versus -15.
GBP/USD Technical Analysis (the 60-min Chart)
Technically, the GBP/USD currency pair appears to be experiencing a short-term bullish bias in the market sentiment. The pair recently started to experience resistance around 1.2400 level amid a lack of momentum.
Therefore, the bulls will be targeting short-term profits at around 1.2519 or higher at 1.2634. On the other hand, the bears will look to pounce for profits at around 1.2302 or lower at 1.2162.
GBP/USD Technical Analysis (the Daily Chart)
In the daily chart, the GBP/USD currency pair appears to have recently made a strong rebound after bottoming at around 1.1424, a new multi-decade low. The pair has now recovered from oversold levels of the daily RSI. It remains below the 100-day and the 200-day SMA lines.
The bulls will target long-term profits at around 76/40% fib level at 1.2761 or higher at 100% Fib level at 1.3209. On the other hand, the bears will look to pounce at around 38.20 Fib level at 1.2108 or lower at 23.60% fib level at 1.1826.