The UK’s flat Retail Sales figures Friday saw bears regaining the upper hand as GBPUSD dropped under the weeks lows and saw a further follow through decline at the open Monday. Ahead we have data for both side as Flash Manufacturing and Services PMI is set for release. Consensus forecast for the UK has us barely in growth territory for Manufacturing at 50.3 while Services is expected to come in at 53.0 We would look to contrast the UK results vis-a-vis the US numbers.
Resistance
- 1.24879 – Moderate: Previous consolidation resistance
- 1.24053 – Moderate: Previous consolidation floor
- 1.23620 – Minor: Pullback High
Support
- 1.22997 – Minor: Yesterday’s Low
- 1.22611 – Minor: Intraday Consolidation Floor (November)
- 1.21885 – Moderate: November 10 low (pullback)
GBPUSD saw a long tail at the close though given the substantial body size we view it as mere profit taking from over the weekend shorts and not signalling a reversal. Daily oscillators appear poised to go off oversold levels though we see any upside as limited. Immediate risk is for a further pullback towards the 1.24053 breakout point, keep an eye on data and as expected to worse results for the UK will have us looking to sell once more.
