Key Highlights
- The British Pound made a medium-term top at 1.3298 against the US Dollar and moved down.
- There was a break below two important bullish trend lines at 1.3150 on the 4-hours chart of GBP/USD.
- Recently, the UK’s BRC Like-For-Like Retail Sales for July 2017 (YoY) was released, which posted an increase of 0.9%.
- Today in the US, the NFIB Business Optimism Index for July 2017 will be released, which is forecasted to remain at 103.6.
GBPUSD Technical Analysis
The British Pound seems like completed an uptrend near 1.3260 against the US Dollar. The GBP/USD pair is now below 1.3100 and trading with a negative bias.
Looking at the 4-hour chart, there was a break below two important bullish trend lines at 1.3150. The pair also moved below the 100 simple moving average to trade as low as 1.3012.
The pair seems to be forming a short-term bottom above 1.3000 and might recover. On the upside, an initial resistance is near the 23.6% Fib retracement level of the last decline from the 1.3268 high to 1.3013 low at 1.3073.
Above 1.3073, the 100 simple moving average (H4) is positioned at 1.3085. So, if the pair continues to move higher, the 1.3080-1.3100 zone is likely to act as a major resistance for buyers.
On the downside, the 1.3000 handle holds a lot of importance and remains a key pivot for GBP/USD.
UK’s BRC Like-For-Like Retail Sales
Recently, the UK’s BRC Like-For-Like Retail Sales for July 2017 was released by the British Retail Consortium. The market was aligned for an increase of 0.6% compared with the same month a year ago.
However, the actual result was better, as the BRC Like-For-Like Retail Sales grew by 0.9%. However, it was less than the last increase of 1.2%. The increase in sales was mostly driven by food sales. On the other hand, non- food sales moved into negative territory.
Commenting on the same, the Chief Executive at BRC, Helen Dickinson OBE, stated:
Sales growth slowed in July from June. That said, given the strong performance of the same month the previous year, the figures are fairly solid. Closer inspection of the headlines however unveils some familiar challenges. While online sales continue to outpace in-store growth, it is not one at the expense of the other.
Overall, the GBP/USD pair may correct a few pips higher in the near term towards 1.3080-1.3100. However, the pair is most likely to face sellers near 1.3100 and the 100 SMA (H4).
