29 Oct 2013
GBP/USD holds its bearings on mixed US data
FXstreet.com (Athens) – The GBP/USD lost some slight ground – roughly 15 pips – after US retail sales were announced down by 0.1% (mainly due to auto slip) as well as wholesale prices (also released down by 0.1%), but regained the lost soil on solid US house prices.
GBP/USD little changed on best Case-Shiller home prices since 2006; still home prices unlikely to sway Fed
The GBP/USD was trading slightly downwards after the US data pertaining to the Producer Prices index and the retail sales let down market participants. Briefly, the cable was trading at 1.6080 before the US data showed that the US retail sales were down by 0.1% in the first three weeks of October, mainly due to a decline in auto purchases. In addition, the producer prices fell in September by 0.1%, a further sign that inflation pressures are muted ahead of the two-day FOMC meeting. While the cable lost approximately 15 pips on the slightly weaker news than expected, it pared all of its tiny losses after the release of the best Case-Shiller home prices since 2006. Obviously, Fed will not be much amazed on this release because after all it is in total contradiction with yesterday’s fallback in September pending sales.
Technical Outlook on the GBP/USD
Karen Jones Head Technical Analyst of Commerzbank, mentions that the “GBP/USD eased back from the 1.6259 early October high.This together with the 1.6302/69 2012 highs and 2009-13 resistance line should act in unison to offer some tough overhead resistance for the market. We are alert to failure at this critical zone and note the 13 count on the daily chart from the TD combo indicator (TD resistance lies at1.6335) and the large divergence of the daily RSI. We have a 3 month uptrend at 1.6030 and failure here will trigger losses to last weeks low and initial Fibo support at 1.5896/1.5915. Failure there will target the 38.2% Fibonacci retracement of the July-to-October advance at 1.5705 and possibly 1.5535, the 50% retracement.”
GBP/USD little changed on best Case-Shiller home prices since 2006; still home prices unlikely to sway Fed
The GBP/USD was trading slightly downwards after the US data pertaining to the Producer Prices index and the retail sales let down market participants. Briefly, the cable was trading at 1.6080 before the US data showed that the US retail sales were down by 0.1% in the first three weeks of October, mainly due to a decline in auto purchases. In addition, the producer prices fell in September by 0.1%, a further sign that inflation pressures are muted ahead of the two-day FOMC meeting. While the cable lost approximately 15 pips on the slightly weaker news than expected, it pared all of its tiny losses after the release of the best Case-Shiller home prices since 2006. Obviously, Fed will not be much amazed on this release because after all it is in total contradiction with yesterday’s fallback in September pending sales.
Technical Outlook on the GBP/USD
Karen Jones Head Technical Analyst of Commerzbank, mentions that the “GBP/USD eased back from the 1.6259 early October high.This together with the 1.6302/69 2012 highs and 2009-13 resistance line should act in unison to offer some tough overhead resistance for the market. We are alert to failure at this critical zone and note the 13 count on the daily chart from the TD combo indicator (TD resistance lies at1.6335) and the large divergence of the daily RSI. We have a 3 month uptrend at 1.6030 and failure here will trigger losses to last weeks low and initial Fibo support at 1.5896/1.5915. Failure there will target the 38.2% Fibonacci retracement of the July-to-October advance at 1.5705 and possibly 1.5535, the 50% retracement.”