British Pound: USD/GBP (GBP=X) U.K posted a rare budget surplus in January
GBP/USD is steady in the Thursday session, continuing the trend seen on Wednesday. In North American trade, the pair is trading at 1.3051, unchanged on the day. In economic news, the U.K posted a rare budget surplus in January. The surplus of GBP 15.8 beat the estimate of GBP 11.1 billion. In the U.S., durable goods orders improved to 1.2%, but fell short of the estimate of 1.6%. Core Durable Goods Orders rebounded with a gain of 0.1%, shy of the forecast of 0.3%. Unemployment claims dropped sharply to 216 thousand, a four-week low. However, the Philly Fed Manufacturing Index slipped to -4.1, its first decline since May 2016.
The Federal Reserve has presented a dovish stance in 2019, and this position was underscored in the minutes from the January 2019 policy meeting. Participants reiterated that the Fed will remain cautious, stating that a “patient approach to monetary policy” was appropriate. However, members added that if economic projections improved, the Fed could revise the “patient approach”. The minutes noted that the employment market had strengthened and economic activity was rising, but expected GDP in 2019 to slow down compared to 2018.
The pound has enjoyed a strong week, with gains of 1.4 percent. Investors have responded positively to strong data this week. On Thursday, the U.K. posted the largest January surplus on record. Earlier in the week, employment numbers were strong. Wage growth climbed 3.4% for a second straight month, while the unemployment rate remained pegged at 4.0%. Still, the uncertainty of Brexit remains a serious concern. With London and Brussels deadlocked over a withdrawal agreement, a no-deal scenario remains a strong possibility, which could have severe ramifications for the British economy and could send the pound sharply lower. With only five weeks left before Britain departs from the E.U., the pound could face some volatility in the near term.
Overall, the bias in prices is: Sideways.
The projected upper bound is: 1.32.
The projected lower bound is: 1.29.
The projected closing price is: 1.30.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 4 white candles and 5 black candles for a net of 1 black candles. During the past 50 bars, there have been 25 white candles and 24 black candles for a net of 1 white candles.
A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 78.4826. This is not an overbought or oversold reading. The last signal was a sell 0 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 56.95. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 19 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 105.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a buy 5 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 2 period(s) ago.
Rex Takasugi – TD Profile
FOREX GBP= closed down -0.001 at 1.304. Volume was 97% below average (consolidating) and Bollinger Bands were 8% narrower than normal.
Open High Low Close Volume___
1.304 1.305 1.303 1.304 5,346
Short Term: Overbought
Intermediate Term: Bearish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 1.29 1.29 1.30
Volatility: 9 9 10
Volume: 146,752 162,884 177,559
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
FOREX GBP= is currently 0.3% above its 200-period moving average and is in an downward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect volume flowing into and out of GBP= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on GBP= and have had this outlook for the last 8 periods.