The GBP/USD hit the U3 on the back of strong retail sales data in the UK. The pair bounced back to the U2 and is now in a sideways trend. Consolidation in a narrow range is a bullish sign. The bulls will try to push onwards and upwards. Since on the daily they have broken the trend and are currently unstoppable, they will roll on up. Taking into account the previous growth patterns, I’m inclined to favor an upward growth.
So is there anyone out there who can stop the pound? Yes. Amongst the other statistics today there are a lot of people giving speeches. At 9:00 EET in Germany there’s some definitive data on Q1 GDP values for the country. At 11:00 the May Ifo business optimization index is expected. At 11:00 EET and 16:30 EET the ECB’s Mario Draghi will give a speech. At 14:00 and 16:30 EET the Bank of England’s Mark Carney will give a speech and at 20:00 EET the head of the US Federal Reserve, Janet Yellen, will let us know her thoughts.
At 15:30 in the United States and Canada the April data for their respective consumer price indices will come out.
The pound/dollar rate leapt from 1.5445 after seeing the minutes from the Bank of England. Yesterday growth on the pair gathered pace on news of retail sales data. Growth above 1.5640 wasn’t wanted, so risks of a growth to the 1.5792-1.5813 zone increased.
The bulls managed to win back almost all of their losses. The weekly candle still hasn’t been closed, so it’s a bit early to jump to any conclusions. However, at the moment we can see that the reverse candle combination (bear takeover) has been cancelled out.