- GBP/USD struggles close to 1.3000 despite upbeat retail sales.
- The market mood and US retail sales are set to dominate trading.
- The technical picture is worsening for the pair, but uptrend support can help.
GBP/USD is trading just above 1.3000, lower on the day. The thrill in markets is gone and the downbeat mood boosts the safe-haven US Dollar. China and the US reported "new progress" on trade talks, but these reports have circulated before.
The upbeat UK retail sales report sent GBP/USD temporarily higher. Sales rose by 1.1% in March, beating expectations for a drop. In addition, it came on top of upwards revisions. Excluding fuel, an increase of 1.2% was seen, also far above early forecasts.
Retail sales complete a series of three top-tier figures that began with the OK jobs report, continued with the mediocre inflation data and concludes now. All in all, the data is mixed and does not provide a clear direction, leaving the few Brexit headlines and the market mood to shape trading. Without any progress in Conservative-Labour talks, the pound is probably limited.
Later today, the US releases its own retail sales report. Moderate increases are on the cards.
See US Retail Sales Preview: Let the spending begin
GBP/USD Technical Analysis
-636911760750520622.png)
After the downtrend resistance line rejected any upside move, GBP/USD is now closer to the uptrend support line that also dates back to early March. The line meets the round 1.3000 level at the time of writing, making it a critical support line.
Momentum on the four-hour chart remains to the downside and the Relative Strength Index is nearing 30, but still holds above oversold conditions.
Support below 1.3000 is at 1.2985 which is the low point in April so far. The March trough of 1.2960 is next, followed by 1.2895 and 1.2830.
Resistance is at 1.3035 that was a support line in mid-April. 1.3070 was a swing high earlier this week. 1.3120 was the high point in recent weeks and far above, 1.3270 is the April high.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
AUD/USD loses ground due to the absence of a hawkish RBA
The Australian Dollar has plunged following the Reserve Bank of Australia's decision to maintain its interest rate at 4.35% on Tuesday. Investors sentiment leaned toward a potentially more hawkish stance from the RBA, particularly after last week's inflation data surpassed expectations.
EUR/USD edges lower to near 1.0750 after hawkish remarks from a Fed official
EUR/USD extends its losses for the second successive session, trading around 1.0750 during the Asian session on Wednesday. The US Dollar gains ground due to the expectations of the Federal Reserve’s prolonging higher interest rates.
Gold price remains on the defensive on a firmer US Dollar
Gold price attracts some sellers on the firmer US Dollar during the Asian trading hours on Wednesday. The hawkish remarks from Federal Reserve officials dampen hopes for potential interest rate cuts in 2024 despite weaker-than-expected US employment reports in April.
FTX files consensus-based plan of reorganization, awaits bankruptcy court approval
FTX has filed a consensus-based plan for its reorganization, coming almost two years after the now defunct FTX filed for Chapter 11 Bankruptcy Protection in the District of Delaware.
No obvious macro catalysts to steer the bus
The US data calendar remains relatively light, with initial jobless claims and the University of Michigan survey being the key focus. However, these releases may not provide a significant catalyst for the next directional move in the US Dollar.