GBP/USD rebounded from the 50-day moving average on Wednesday, although the uptick ran out of steam in Asia at a high of 1.3228.
Currently, the spot is trading at 1.32 levels and the 50-day moving average is located at 1.3156.
UK retail sales are due at 08:30 GMT
Retail sales are seen falling 0.1% m/m in September. The annualized growth is seen slowing to 2.1 percent from 2.4 percent. Core retail sales (ex fuel) growth is likely to have slowed to 0.1 percent m/m and 2.4 percent y/y.
Retail sales could beat estimates, lead indicators say
Figures from the British Retail Consortium (BRC) and KPMG showed that showed that like-for-like retail sales rose 1.9 percent last month, compared to a 0.4 percent rise a year earlier. Total sales rose 2.3%, while online sales surged 10.7% in September.
Thus, odds are high that the official retail sales data due today could print higher than expected (slowdown could be much less than estimates).
A better-than-expected UK retail sales figure could lift the GBP/USD to 1.3268 (38.2% Fib R of Sep. 20 high - Oct. 6 low). However, the sustainability of the gains depends on the outcome of the Brexit summit.
May under pressure to make 'deal or no deal' ultimatum
As per The Telegraph report, four former Cabinet ministers, as well as MPs, business leaders and academics have urged PM Theresa May to walk away from the EU and stop negotiations if European leaders do not agree to trade talks at a crucial summit on Thursday evening.
While a 'no deal' scenario could be disastrous for both sides, the first to take a hit could be the British Pound. On the other hand, a positive outcome of the summit could push the Pound higher even if the retail sales fall more than expected.
GBP/USD Technical Outlook
On the downside, support is lined up at 1.3170 (trend line sloping upwards from Mar. 14 low and Jun. 21 low) and 1.3156 (50-day MA). A violation there would open up downside towards 1.3043 (100-day MA). On the higher side, a break above 1.3222 (Oct. 3 low) could yield 1.33 (zero levels) and 1.3338 (Oct. 13 high).
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD stays in positive territory above 1.0850 after US data
EUR/USD clings to modest daily gains above 1.0850 in the second half of the day on Friday. The improving risk mood makes it difficult for the US Dollar to hold its ground after PCE inflation data, helping the pair edge higher ahead of the weekend.
GBP/USD stabilizes above 1.2850 as risk mood improves
GBP/USD maintains recovery momentum and fluctuates above 1.2850 in the American session on Friday. The positive shift seen in risk mood doesn't allow the US Dollar to preserve its strength and supports the pair.
Gold rebounds above $2,380 as US yields stretch lower
Following a quiet European session, Gold gathers bullish momentum and trades decisively higher on the day above $2,380. The benchmark 10-year US Treasury bond yield loses more than 1% on the day after US PCE inflation data, fuelling XAU/USD's upside.
Avalanche price sets for a rally following retest of key support level
Avalanche (AVAX) price bounced off the $26.34 support level to trade at $27.95 as of Friday. Growing on-chain development activity indicates a potential bullish move in the coming days.
The election, Trump's Dollar policy, and the future of the Yen
After an assassination attempt on former President Donald Trump and drop out of President Biden, Kamala Harris has been endorsed as the Democratic candidate to compete against Trump in the upcoming November US presidential election.