GBP/USD – Pound Slightly Lower in Subdued Trade

GBP/USD has posted slight losses on Thursday, as the pair trades in the low-1.57 range in the North American session. It’s a very quiet day on the release front, as there are no UK releases. US markets are closed for Thanksgiving, so there are no US events until next week. Traders can expect light trade in today’s North American session.

The US released a host of key data on Wednesday, but the numbers were weak across-the-board. Unemployment Claims jumped to 313 thousand, its highest level since mid-September. Core Durable Goods Orders declined 0.9%, its third decline in four readings. The estimate stood at 0.5%. New Home Sales fell to a 3-month low, dropping to 458 thousand. This was short of the estimate of 471 thousand. Pending Home Sales was no better, declining by 1.1%, well off the estimate of 0.9%. There was better news from UoM Consumer Sentiment, which posted a fourth straight gain, rising to 88.8 points. However, this was short of the estimate of 90.2 points.

British GDP posted a respectable gain of 0.7% in Q3, matching the forecast. However, this was shy of the 0.9% gain recorded in Q2. The weaker reading reflects softer data across the UK economy in the third quarter. Earlier in the week, BoE Governor Mark Carney testified before Parliament’s Treasury Committee on Tuesday, and his remarks echoed the dovish Inflation Report which was released earlier in the month. Carney said that inflation levels will likely fall below 1% in the next several months, but should then move back towards the BoE target of 2%. Carney noted that the British economy is under pressure from weak economic conditions in Japan and the Eurozone. The markets have tempered their expectations of a rate hike as the BoE has lowered its forecasts for growth and inflation.

 

GBP/USD for Thursday, November 27, 2014

GBP/USD November 27 at 16:05 GMT

GBP/USD 1.5724 H: 1.5825 L: 1.5721

 

GBP/USD Technical

S3 S2 S1 R1 R2 R3
1.5505 1.5644 1.5717 1.5864 1.6000 1.6141

 

  • GBP/USD posted gains late in the Asian session but then retracted, recording losses in European trade. The pound remains under pressure in the North American session.
  • 1.5864 is a strong resistance line.
  • On the downside, 1.5717 is under strong pressure and could break during the North American session.  1.5644 is stronger.

Further levels in both directions:

  • Below: 1.5717, 1.5644, 1.5505, 1.5392 and 1.5282
  • Above: 1.5864, 1.6000, 1.6141 and 1.6263

 

OANDA’s Open Positions Ratio

GBP/USD ratio is pointing to gains in short positions on Thursday. This is consistent with the movement of the pair, as the pound has posted losses. The ratio has a majority of long positions, indicative of trader bias towards the pound reversing directions and moving higher.

GBP/USD Fundamentals

  • There are no UK or US releases on Thursday.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.