Tough luck for the pound bulls, as they simply couldn’t sustain the momentum gained from the previous couple of trading days. GBP/USD basically gave back all of its Thursdays gains, as it ended the day trading around 1.5350. What could be in store for us this week?
No biggies for today, so we may see GBP/USD price action stick in consolidation mode.
Watch out though, as we’ve got tons of red flags headed our way throughout the week. The monthly CPI, employment, retail sales, and the latest MPC meeting minutes are all scheduled for release, so make sure you check in regularly for my two pips on each of the reports.
Ka-pow! Like most of the higher-yielding majors, the pound took a hit from the dollar and the yen in yesterday’s trading. GBP/USD fell from an intraday high of 1.5386 to close the day with a 58-pip loss at 1.5282. Meanwhile, GBP/JPY was down 278 pips at 147.91.
The lack of economic reports left the pound vulnerable to market sentiment. Unfortunately for the currency, risk aversion dominated the markets following the disappointing figures from China.
But don’t fret! Today the U.K. CPI report for March will be released at 8:30 am GMT. If you still remember, the BOE has been recently expressing their worry for inflation. If the figure for march tops the forecast at 2.8%, we could see the pound rally against its counterparts as it would give the central bank one more reason not to increase asset purchases.
Don’t miss the report, ayt?
That’s what I call a comeback baby! The pound bulls ended the day on a strong note, allowing GBP/USD to finish at 1.5375, a solid 94 pips above its opening price. Could we see more of the same today?!
As it turns out, the U.K. CPI report turned out to be a real snoozer, as it came in right in line with expectations at 2.8%. Keep in mind that this is right near the top of the Bank of England’s target band, although the central bank does want to get inflation to a more manageable 2% level.
Speaking of the BOE, the minutes of the latest BOE meeting will be available today at 8:30 am GMT. This report should reveal what was discussed at the last meeting. Take note that policymakers have cited high inflation as a reason why they are reluctant to pull the trigger on additional bond purchases. Let’s see if they’re sticking to that stance or whether they are moving closer to adding more easing measures to the U.K. economy.
Also scheduled for release at 8:30 am GMT will be the claimant count change report. Expectations are that there was no change from the number of people filing for unemployment benefits last month, but looking at past results, we can see that this report often misses initial forecasts. Should we see a huge negative number (indicating less people filing for claims), it could provide the pound bulls the juice they need to sustain their momentum.
Talk about having a tough day! The pound gave up ALL of its gains on Tuesday (and much more!) to the dollar. After GBP/USD opened at what turned out to be its intraday high at 1.5375, the pair dropped like a rock to close at 1.5240.
What caused the pound sell-off? It was none other than the U.K. jobs reports.
According to data released by the Office for National Statistics, claimant count change fell lower for the fifth month in a row. For March, it clocked in a 7,000 decline in the number of people filing for unemployment benefits.
While that was good news, the rise in the unemployment rate overshadowed whatever positive vibes that the claimant count report might have been inspired. The percentage of the U.K.'s work force that is actively looking for a job but couldn’t find one is now up at 7.9% from 7.8%. Yikes!
Today, the retail sales report for March will be on tap for the pound and chances are, it will cause a bit of volatility on the charts. The report is due at 8:30 am GMT and it is eyed to come in at -0.7%. A worse-than-expected figure could send the currency even lower. So make sure you don’t miss it!
Weak retail sales? No problem! The pound got a breather from its losses yesterday when the currency bears ran out of steam. Cable even closed 42 pips higher than its open price while Guppy recovered from its intraday low at 148.75 end closed at 150.08. Phew!
As if the weak employment numbers weren’t enough to hint at the U.K. economy’s weakness, a retail sales report printed yesterday also revealed that customer purchases had declined by 0.7% in March instead of rising by 2.1% like it did in February. Apparently, the cold weather limited the consumers’ urge to buy their favorite goods.
The weak data didn’t rain on the pound bulls’ parade though! After initially dropping at the release, the pound recovered against almost all its counterparts in the later trading sessions.
Will traders continue to drive the pound higher? No data is scheduled for release today, but the IMF and the G20 countries are having their weekend meeting starting in a couple of hours. Watch out for any speeches that might influence the price action of high-yielding currencies!
The pound went down swingin’ with a 49-pip loss against the dollar in Friday’s trading. GBP/USD rallied at the start of the day but lost its momentum during the London session. By the day’s close, the pair was down to 1.5233.
No reports were released from the U.K. which left the pound at the mercy of market sentiment. Unfortunately for the currency, risk appetite waned as political instability continued to cloud Italy’s outlook, and as traders took profit ahead of the G20 meetings over the weekend.
Our forex calendar still doesn’t have anything on tap for the pound today. But don’t worry! The GDP report for Q1 2013 will be released on Thursday and could provide the pound with a clearer direction on the charts.
Until then, you may have to continue gauging market sentiment in order to get a feel for the currency’s behavior. Good luck!
Thanks to encouraging comments from both the IMF and the World Bank, Cable was able to stage a very respectable rally yesterday. It opened the day at 1.5234, rose to an intraday high at 1.5292, and then finally settled at 1.5282.
In a television interview, IMF Chief Christine Lagarde said that global growth was not performing up to par. She singled out Britain, saying that it might be a good time for the country to cut down on austerity measures due to the recent weakness in its economy.
No data was released yesterday but we’ve got a few tier 2 reports on the docket today. At 8:30 am GMT, U.K.’s figures on public sector net borrowing will be published. It’s expected to show a 14.3 billion GBP figure, up from the previous month’s 4.4 billion GBP. Then, at 10:00 am GMT, the CBI Industrial Trends survey will come out. A reading of -14 is projected, which slightly higher from the month prior’s -15.
Both these reports do not normally have a strong impact on price action, but it’s still worthwhile to keep tabs on them. After all, it’s always better to be safe than sorry!
Both the pound bulls and bears got busy yesterday as they considered the U.K.’s grim reports and the overall risk aversion in the euro region. GBP/USD slipped by 40 pips but EUR/GBP also fell by 19 pips.
It would’ve been an easy decision for pound traders if they had only considered the U.K.s reports. The government’s borrowing might have narrowed to 15.1 billion GBP from 16.7 billion GBP a year ago, but the CBI industrial order expectations also fell to a -25 reading, a lot lower than the previous -15 figure.
The pound wasn’t the ugliest duckling in the pond though. The euro took steep hits against its counterparts, which prompted some pound bulls into action.
Will the U.K.’s reports continue to print mixed results? At 8:30 am GMT today we’ll see the BBA mortgage approvals, which is expected to show slight improvement from last month’s release. Then, at 10:00 am GMT the CBI realized sales will be printed. The report is expected to print an index reading of 7 in March (above 0 indicates higher sales volume), but keep an eye out for any surprises!
Despite the weaker-than-expected Distributive Trades Survey, Cable still managed to climb higher yesterday. It opened the day at 1.5242, rose to an intraday high of 1.5289, and then closed the U.S. trading session at 1.5265.
The Distributive Trades Survey disappointed and printed a reading of -1. The market had initially expected a reading of 7. This meant that sales volume of retailers and wholesalers are declining. In other economic news, the BBA Mortgage Approvals report came in line with forecast. It showed that the number of new mortgages approved by the BBA-represented banks rose to 31.2K in March from 30.6K.
Today, Cable’s price action will be determined by the upcoming preliminary Q1 2013 GDP report. It’s projected to show that the U.K. avoided a recession by growing 0.1%. If forecast doesn’t hold and the GDP turns out to be negative, it will put U.K. in a technical recession, which will likely be bearish for Cable.
Ha! Who’s the loser now? The pound blasted above its counterparts yesterday when the U.K.’s GDP report came out better than many had expected. Cable popped up by a nice 165 pips while Guppy also enjoyed a nice 132-pip rally.
Yesterday the U.K.’s much awaited quarterly GDP report printed a 0.3% growth, which was a relief considering that analysts were only expecting a 0.1% reading.
What made the report even more significant though, was that it means that the U.K. has temporarily dodged a triple-dip recession. Recall that a negative reading would have put the U.K. in a technical recession given that economic activity had shrunk by 0.3% in the last report.
The U.K. won’t be releasing any economic data today, so you might want to keep your eyes on other major events that could influence the high-yielding currencies’ price action. I bet the BOJ’s monetary policy announcement today and the U.S. GDP data at 12:30 pm GMT would at least get the attention of the pound bulls and bears!
The party ain’t over yet! GBP/USD continued to rally on Friday as the pair climbed close to the 1.5500 major psychological level. From there, cable got stuck in consolidation for the rest of Friday’s New York session until the start of this week. Will it head any higher?
Although sentiment for the pound was still very bullish on Friday, the lack of any top-tier data from the U.K. kept GBP/USD from making further headway. Weaker than expected U.S. GDP did provide the pair a bit of support as the smaller than expected 2.5% expansion triggered a brief dollar selloff.
For today, there are no major reports from the U.K. so it’s likely that GBP/USD could continue to move sideways below 1.5500. The action might pick up later on in the week as the U.K. will start releasing PMI figures starting on Wednesday.
Party’s over, boys! The pound failed to secure a three-peat against its counterparts yesterday as GBP/USD capped the day near its open price while GBP/JPY fell by 10 pips and EUR/GBP shot up by 37 pips. What gives?
Blame the U.K.’s reports! With not much major data scheduled yesterday, it was easy for pound traders to focus on the GfK consumer confidence, which fell from -26 to an index reading of -27 in April. Will the pound recover some of its losses today?
At 8:30 am GMT the individual lending report is due for release. It will be printed around the same time as the mortgage approvals data, which is also expected to print slightly lower than last month’s figure. Be careful though, as a lot of second tier data are scheduled from the euro zone today. Watch them closely and see if they will affect appetite for high-yielding currencies!
The pound bears were on a rampage yesterday as they dragged the currency lower against the yen and the euro. Cable traders missed the memo though, as it closed 36 pips higher than its open price.
With the U.K.’s individual lending report declining and its mortgage approvals data barely meeting expectations can you really blame traders from selling the pound? Yesterday the individual lending data clocked in at 0.9 billion GBP, lower than its 1.3 billion GBP figure in February. Meanwhile, mortgage approvals came in at 54K in March, just a tad bit higher than its 52K reading in February.
Let’s see if the GDP report is the only bright spot in the U.K.’s reports. At 6:00 am GMT we’ll see the Nationwide house price index, followed by the manufacturing PMI report at 8:00 am GMT. Both reports are expected to come in higher than last month’s readings so it would be easier for pound bears to pounce if both reports disappoint.
When will these guys stop?! For the SIXTH day in a row, traders too Cable higher as another U.K. report came in better than expected. The pair had traded as high as 1.5606 before it closed at 1.5552 to lock in a 17 pip gain on the day.
Last month, its manufacturing PMI unexpectedly rose to 49.8 instead of holding steady at 48.6. Yeah, it ain’t really much to go nuts about, considering its still below the 50.0 reading that signals expansion. But it’s still far better than the reading that many had predicted. This suggests one very important thing - the U.K. economy isn’t doing as badly as many had feared!
Today, the U.K. will roll out another PMI report, this time for the construction industry. It’s expected to reveal an increase from 47.2 to 48.1. If it prints another upside surprise, expect the pound to extend its gains! Good luck and happy pippin’ folks!
Look out below! The pound lost its footing on the charts in yesterday’s trading. GBP/USD finished lower for the first time in seven days. It tapped an intraday high of 1.5592 and dropped like a rock to 1.5496 before finishing the New York session at 1.5538 with a 24-pip loss.
Poor pound. It fell victim to the dollar’s strength following the ECB’s remarks that it is open to negative rates. Heck, not even the positive construction PMI report for April kept it afloat. According to Markit, the contraction in the sector improved a bit to 49.4 and topped expectations for a 48.1 reading.
If you’re looking to buy the currency, don’t fret! Who knows, perhaps the services PMI due later at 8:30 am GMT will be enough to boost the pound. The report is expected to print at 52.5 for April.
Up it goes again! Cable resumed its rally after taking a short break on Thursday. The pair traded as low as 1.5481 before the market reversed and climbed to 1.5567, where it locked in a 29-pip gain on the day.
All is good in the U.K. services sector! The April services PMI rose from 52.4 to 52.9 (versus forecasts that called for a reading of 52.5). This not only marks the fourth monthly increase for the services sector, which makes up about three-fourths of the economy, but it also happens to be the strongest pace since April of last year. Boo yeah!
After seeing the stronger-than-expected growth in Q1 2013, it seems as though these recent reports are trying to tell us something – that the U.K. recovery is finally gaining traction. Looking ahead, these recent figures might just be enough to keep the BOE from expanding its asset purchases, eh?
Today’s a banking holiday in the U.K., so the markets may be a bit thinner than usual in the London session. But later this week, we have the much-anticipated BOE rate decision to look forward to. Traders might start entering positions according to their expectations ahead of the statement, so be sure to keep that in mind when trading the pound this week.
Once again, another boring day of consolidation for GBP/USD, as it remains stuck near the top of the rising channel. By the end of the day, the pair was trading 29 pips lower at 1.5541, but failed to set any new high or low.
No surprise that we didn’t see a breakout on Cable yesterday, as no hard data was released and London traders were off on holiday.
In fact, even with market players making it back to their trading desks today, I think the consolidation may continue, as the only report we have is the BRC retail sales report coming in at 11:00 pm GMT. To be honest, I’m not expecting this to spark too much volatility in the markets, although you should still keep in mind when the news will be released.
Whoa! Where did all the buyers go?! It seems as though the bulls have abandoned the pound, leaving it at the mercy of sellers. Because of a strong selloff in the New York session, GBP/USD lost 60 pips and finished at 1.5481. Meanwhile, GBP/JPY tumbled from a high of 154.51 to land at 153.27, posting a 113-pip loss on the day.
It looks as though the markets are finally losing love for the pound! After rallying strongly over the past couple of weeks in response to the release of strong economic reports, the pound is finally retracing a good chunk of its footsteps. The question is whether this is legit reversal or just a minor setback!
For today, we only have the Halifax HPI on tap. Forecasts say we can expect it to print another 0.2% increase in house prices. Though this report ain’t really known for causing big moves on the charts, it might extend the pound’s selloff if it prints well below forecasts. If y’all wanna catch the only U.K. release for today, you’ll have to tune in at 7:00 am GMT.
That’s how you stage a comeback! The pound bulls silenced their critics yesterday, as they pushed Cable up the charts. After nearly retesting the 1.5600 handle, GBP/USD eventually settled at 1.5536, up a solid 56 pips form its opening price.
The only report of note that came out from the U.K. yesterday was the Halifax HPI. The report showed that housing prices rose by 1.1% last month, marking a steady improvement from the 0.4% uptick we saw the month before. This marks the third consecutive month that prices have risen, and the fifth time in the past six months. This hints that the U.K. housing market is slowly showing more signs of stability.
Today, we could be in for some wild moves on GBP pairs, a we’ve got a couple of top tier events on tap.
First, U.K. manufacturing production report will be released at 8:30 am GMT. Expectations are that production rose by 0.4%, which would be a nice follow up to the 0.8% follow up we saw last month. A better than expected figure could give the bulls the fire it needs to push ahead.
Watch out though at 11:00 am GMT, as BOE Mervyn King will be heading his last BOE interest rate decision. Keep in mind that over the past three meetings, we haven’t seen much changes from the BOE, as the voting has remained 6-3 in favor of the hawks. Make sure you hit up Forex Gump’s latest piece for the 411 on this market-rocking event!
The party continues! Currency bulls extended the pound’s rally yesterday after reports from the U.K. printed to the upside. GBP/USD popped up by 171 pips and EUR/GBP slipped 29 pips. Only GBP/USD missed the pound appetite train as it fell 92 pips below its open price.
Yesterday the U.K.’s manufacturing production showed a 1.1% growth, higher than the expected 0.2% uptick. Not only that, but its industrial production data also went up by 0.7%, which is a lot better than the 0.3% increase that many had expected. These reports might be second-tier, but they supported a strong economy that the GDP and PMI report hinted last week.
The icing on the cake was the BOE’s decision to keep its rates at 0.50% and its asset purchases steady at 375 billion GBP. Since the Monetary Policy Committee (MPC) didn’t change anything, no details were provided with the announcement.
Are the upside surprises from the MPC and the U.K.’s economic reports enough to keep the pound supported for the rest of the week? The U.K. is set to release its trade balance numbers at 8:30 am GMT today, so keep an eye out for any surprises that might inspire profit-taking or upside breakouts in pound pairs.
Good luck and good trading!