Friday’s trade saw GBP/USD within the range of 1.4107-1.4159. The pair closed at 1.4143, inching down 0.08% on a daily basis. It has been the 33rd drop in the past 60 trading days. In weekly terms, GBP/USD lost 2.33% of its value in the past week. It has been the 6th drop in the past 12 weeks. GBP/USD has trimmed gains to 1.64% so far during the current month, following four consecutive months of decline.
At 6:36 GMT today GBP/USD was edging up 0.13% for the day to trade at 1.4148. The pair touched a daily high at 1.4150 at 7:16 GMT, overshooting the daily R1 level, and a daily low at 1.4120 during the early phase of the Asian trading session.
On Monday GBP/USD trading may be influenced by the following macroeconomic reports as listed below.
Fundamentals
United States
Personal Income, Personal Spending
Personal spending in the United States probably rose 0.1% in February, according to market expectations, while personal income was probably up for an 11th consecutive month in February, increasing at a monthly rate of 0.1%.
Consumer spending, which accounts for over two thirds of the nations GDP, rose 0.5% in January, due to higher expenditures on durable goods and services. At the same time, personal income increased 0.5% (USD 79.6 billion) during the same month, while disposable personal income (DPI) rose by USD 63.5 billion.
Wages and salaries were up USD 48.1 billion in January, following an increase by USD 18.3 billion in the preceding month, while supplements to wages and salaries rose USD 6.5 billion in January, after going up USD 5.0 billion in December.
Higher-than-expected rates of increase imply good employment conditions and, therefore, are dollar positive. The Bureau of Economic Analysis is to publish the official figures at 12:30 GMT.
Pending Home Sales
The index of pending home sales in the United States probably rose 0.8% in February, according to the median estimate by experts. If so, this would be the sharpest monthly increase since April 2015, when sales went up at a revised down 2.7%. In January pending home sales unexpectedly fell 2.5%, or the most since December 2014.
In annual terms, the index of pending home sales advanced 1.4% in January, which has been a 17th consecutive period of increase. However, Januarys rate of sales growth has been the slowest since September 2014, when sales were up 1.0%.
In case pending home sales increased at a faster pace than anticipated, this would have a moderate bullish effect on the US dollar. The National Association of Realtor’s (NAR) will report on the official index performance at 14:00 GMT.
Correlation with other Majors
Taking into account the week ended on March 25th and the daily closing levels of the major currency pairs, we come to the following conclusions in regard to the strength of relationship:
GBP/USD to EUR/USD (0.9004, or very strong)
GBP/USD to NZD/USD (0.8336, or very strong)
GBP/USD to AUD/USD (0.5583, or strong)
GBP/USD to USD/CAD (-0.6338, or strong)
GBP/USD to USD/JPY (-0.7423, or strong)
GBP/USD to USD/CHF (-0.9041, or very strong)
1. During the examined period GBP/USD moved strongly in the opposite direction compared to USD/CAD and USD/JPY, while moving strongly in one and the same direction with AUD/USD.
2. GBP/USD moved almost equally in one and the same direction with NZD/USD and EUR/USD during the past week. This relationship has been the most pronounced between GBP/USD and EUR/USD.
3. GBP/USD moved almost equally in the opposite direction compared to USD/CHF during the period in question.
Daily and Weekly Pivot Levels
By employing the Camarilla calculation method, the daily pivot levels for GBP/USD are presented as follows:
R1 – 1.4148
R2 – 1.4153
R3 (range resistance) – 1.4157
R4 (range breakout) – 1.4172
S1 – 1.4138
S2 – 1.4133
S3 (range support) – 1.4129
S4 (range breakout) – 1.4114
By using the traditional method of calculation, the weekly pivot levels for GBP/USD are presented as follows:
Central Pivot Point – 1.4226
R1 – 1.4397
R2 – 1.4651
R3 – 1.4822
S1 – 1.3972
S2 – 1.3801
S3 – 1.3547
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