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GBPUSD Unsteady Uptrend

1/18/2023 12:30 PM

The GBP/USD pair is trading with multidirectional dynamics during the morning session, consolidating near 1.2280 and local highs from December 15. The instrument has maintained an unstable uptrend since January 6, despite the fact that the US dollar has been trying to show corrective growth in the last week.

The GBP/USD pair was supported yesterday by data on the labor market from the UK, where the Claimant Count Change in December increased by 19.7 thousand, slowing down from the November figure of 30.5 thousand, and the Unemployment Rate in November on a quarterly basis remained at around 3.7%. Investors also drew attention to the growth in Average Earnings in November: the indicator, which does not include bonuses, accelerated from 6.1% to 6.4%, which turned out to be slightly higher than the forecast at 6.3%, while Average Earnings Including Bonus also increased by 6.4%, while experts did not expect any change in the indicator at all.

Today, investors will follow the December statistics on consumer inflation and retail sales. The Consumer Price Index is expected to add 0.4% MoM, repeating the dynamics of November, and slow down slightly from 10.7% to 10.6% YoY, while Retail Sales may correct from 0.6% to 1.0%.

Analysts predict a fall in the value of real estate in the UK by at least 10.0% due to a significant decrease in demand. Negative dynamics is facilitated by the course of the Bank of England to tighten monetary policy and, in particular, an increase in interest rates, which led to an increase in the cost of mortgage loans. Executive Director of Lloyds Banking Group Plc. Charlie Nunn noted that the pressure on the sector will intensify against the backdrop of a recession, which, according to the forecast, will be moderate, and the national economy is likely to begin to recover as early as this year.

Bollinger Bands in D1 chart show moderate growth. The price range expands, freeing a path to new local highs for the "bulls". MACD is growing preserving a weak buy signal (located above the signal line). Stochastic, retreating from its highs, reversed into a horizontal plane near the level of "80", reacting to the significant growth of the pound the day before.

Resistance levels: 1.2311, 1.2400, 1.2500, 1.2600. | Support levels: 1.2240, 1.2150, 1.2084, 1.2000.

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