GBP/USD: Buyers await UK retail sales to validate 1.3035/30 support

  • Traders await fresh clues from the economic calendar to justify the strength of near-term support-line.
  • Lack of Brexit news limits pair moves with overall anti-no-deal sentiment restricting further downside.

The GBP/USD pair is mostly unchanged around 1.3040 ahead of the London open on Thursday. The quote clings to a nine-week-old upward sloping trend-line while waiting for the UK retail sales for fresh triggers.

The Cable recently dropped to the lowest in a week after the UK consumer price index (CPI) fell behind 2.0% forecast to remain unchanged at 1.9%. However, lack of Brexit negatives and aforementioned support-line confined the pair’s further declines.

Easter recess in the British Parliaments till April 23 restricts the Brexit news flow off-late.

During early Thursday, investor sentiment remained mostly downbeat as news of KCNA report that North Korea tested tactical weapon under the leader Kim Jong Un’s guidance renewed geopolitical fears of the US-North Korea tension.

With this, the US 10-year treasury yield dropped nearly 2 basis points to 2.57% from 2.59%.

Looking forward, March month retail sales from the UK will become the key driver for the GBP/USD pair as the same contributes the majority into the British GDP. The retail sales growth is expected to decline -0.3% from +0.4% on a monthly basis but may rise 4.6% from 4.0% earlier while observing YoY format. The retail sales ex-fuel, also known as core retail sales, may advance by +4.0% versus 3.8% and drop with -0.3% against +0.2% on a yearly and an MoM basis.

In addition to the UK retail sales, the US is also up for releasing its March month retail sales data together with Philadelphia Fed manufacturing survey (Mar), weekly jobless claims and Markit PMI (Apr).

The US retail sales control group could rise +0.4% from -0.2% earlier contraction whereas its manufacturing gauge may soften to 10.4 from 13.7. Also, initial jobless claims for the week ended on April 12 may increase to 205K from 196K while Markit manufacturing purchasing manager index (PMI) could strengthen to 52.8 from 52.4 with services PMI likely weakening towards 55.0 from 55.3.

GBP/USD Technical Analysis

Given the upbeat British data triggers the GBP/USD pair’s upside, 1.3070 and 1.3100-1.3108 area comprising 50-day simple moving average (SMA) and a descending trend-line since March 13, seem important to watch. It should also be noted that the break of 1.3105 can fuel prices to 1.3130 and 1.3200 during the further rally.

Alternatively, break of more than two-month-old ascending trend-line now near 1.3035/30 can drag the quote to 1.3000 and 200-day SMA level of 1.2970.

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.

Feed news

FXStreet Trading Signals now available!

Access to real-time signals, community and guidance now!

Latest Forex News

Editors’ Picks

EUR/USD hits highest since March amid US protests, European reopening

EUR/USD has jumped above 1.1150, trading at the highest since March. Protests in the US are grabbing the headlines and marginally supporting the dollar. European countries continue reopening their economies amid falling coronavirus statistics. 


GBP/USD resumes rally amid Brexit optimism, dollar weakness

GBP/USD is trading above 1.2550, extending its gains. Reports about British readiness to compromise in Brexit talks, conditioned on EU concessions, is helping boost the pound. US protests are eyed.


Bitcoin is three steps away from $14000

Bitcoin joins the list of bullish breakouts and leaves the relative highs at $14000 as a clear target in the short term. Ethereum continues to gain market share and sets the price level of $300 as a goal in the short term.

Read more

Gold trades with modest losses around $1735 level, downside seems limited

Gold traded with a mild negative bias through the early European session and was last seen hovering near the lower end of its daily range, around the $1735 region.

Gold News

WTI sits at three-month highs near $36.50 ahead of Russia’s decision, API

WTI (July futures on Nymex) broke its bullish consolidative phase to the upside in the European session and clinched fresh three-month highs at 36.48.

Oil News