Gbpusd falls as US new-home sales rise and UK retail data awaited

GBPUSD Analysis

Performance after Wednesday
Period	Pct	Chg	Momentum
Wednesday	-0.22%	-29.3 Pips
Week to-date	-0.18%	-24 Pips
April	2.73%	352.4 Pips

Upcoming key events (London Time)

Fri 07:00 AM GBP Retail Sales Volumes (1-mth)

What happened lately

In the United States, there has been a noticeable increase in new-home sales for the month of March, with a significant rise of 7.4% compared to the 1.8% increase recorded in February. This robust growth in new-home sales indicates a positive momentum in the housing market, suggesting increased consumer confidence and possibly a response to favorable borrowing rates or improved economic conditions. The rise in new-home sales can contribute to economic growth, as it supports related sectors such as construction, real estate, and home goods, providing an economic boost that may reverberate through various other consumer-driven areas.

In the United Kingdom, the economic focus shifts towards the upcoming retail sales volume figures, which will be released at 07:00 AM on Friday. Retail sales volumes are a crucial indicator of consumer spending, reflecting the overall economic health of the country as consumer expenditure is a major component of the GDP. A higher-than-expected increase in retail sales volumes would suggest strong consumer confidence and spending, potentially providing positive support for the British economy and the pound.

The recent U.S. data, along with the anticipation of the UK retail sales numbers, could have notable implications for the GBPUSD currency pair. As of Wednesday, the GBPUSD has declined by 0.22%, closing at 1.32606. The rise in U.S. new-home sales reflects a strengthening U.S. economy, which could support the U.S. dollar, exerting downward pressure on the GBPUSD pair. However, if the UK retail sales figures surpass expectations, this could offset some of the downward movement by strengthening the British pound against the U.S. dollar. Ultimately, the interplay between U.S. economic data and U.K. retail sales outcomes will be critical in shaping the near-term movements of the GBPUSD currency pair.

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What can we expect from GBPUSD today?

GBPUSD on Wednesday dropped -0.22% to 1.32606. Price is above 9-Day EMA while Stochastic is falling.

Updated daily direction for GBPUSD looks bearish as the pair posted lower in Wednesday trading session.

Looking ahead for the day, immediate support level is at S1 1.32157 with break below could see further selling pressure towards S2 at 1.31707. To the upside, with the current momentum bearish, we prefer to look at breakout of the recent daily high of 1.33390 as a potential indicator of buying interest. Failure to break the resistance level would continue to echo bearish sentiment. A close below 1.32324 would indicate selling pressure.

For the week to-date, take note that GBPUSD is mixed as compared to the prior week.

Key levels to watch out:

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