Price is trading in the green and seems motivated to climb towards new highs. It’s trying to erase the yesterday’s losses, should jump much higher as the USDX is trading in the red and could take out the support from the 92.49 static support.

USDX retested a dynamic resistance and seems motivated to approach and reach new lows, a further drop will punish the USD, which will lose more ground versus its major rivals. The dollar index needs a bullish spark to be able to really start another leg higher in the upcoming period. Technically, the USDX is somehow expected to climb higher after the last Thursday’s spike down.

The BRC Retail Sales Monitor increased by 1.3%, beating the 0.9% growth in the former reading period, while the Services PMI decreased from 53.8 to 53.2 points, much below the 53.5 estimate.

We may have some volatility in the afternoon as the FOMC Member Brainard speaks, the US Factory Orders will be released and are expected to drop by 3.3% versus a 3.0% growth in the former reading period. Moreover, the IBD/TIPP Economic Optimism increased from 52.2 to 53.1 points. The FOMC Member Kashkari will speak as well tonight and could bring some action on this pair.

Price increased after the retest of the 250% Fibonacci line (ascending dotted line). Could hit the 1.3046 static resistance in the upcoming days, where he may find resistance again. Technically should climb much higher after the false breakdown below the upper median line (UML) of the major descending pitchfork. Remains to see what will happen because has shown some exhaustion signs after the failure to climb in the former’s Rising Wedge pattern body.

Right now we can’t talk about a leg lower because we don’t have any reversal signs and because the USDX is under massive selling pressure on the daily chart. Only a bounce back on the dollar index will signal a potential drop on the GBP/USD.

I’ve drawn a minor descending pitchfork to catch a potential downside movement, we have a false breakdown below the median line (ml) and now is expected to retest the upper median line (uml).