Yesterday’s trade saw GBP/USD within the range of 1.4462-1.4572. The pair closed at 1.4505, shedding 0.20% on a daily basis. It has been the 14th drop in the past 29 trading days and also a second consecutive one. The daily low has been the lowest level since April 25th, when a low of 1.4400 was registered. GBP/USD has extended its loss to 0.64% so far during the current month, following two consecutive months of advance.
At 6:55 GMT today GBP/USD was inching up 0.06% on the day to trade at 1.4514. The pair touched a daily high at 1.4529 at 6:32 GMT, overshooting the daily R2 level, and a daily low at 1.4494 during the early phase of the Asian trade.
On Thursday GBP/USD trading may be influenced by the following macroeconomic reports and other events as listed below.
Fundamentals
United Kingdom
Services PMI
Activity in United Kingdom’s sector of services probably increased at a slower rate in April compared to a month ago, with the corresponding PMI coming in at 53.5, down from 53.7 in March. If market expectations were met, April would be the 40th consecutive month, when the gauge inhabited the area above 50.0. The index is based on a survey, encompassing managers of companies, that operate in sectors such as transportation, communications, IT, financial intermediation, tourism. They are asked about their estimate regarding current business conditions (new orders, output, employment, demand in the future). Values above the key level of 50.0 signify predominant optimism (expansion in general activity). A larger-than-projected slowdown in the index would have a moderate bearish effect on the pound. The Chartered Institute of Purchasing and Supply (CIPS) is expected to release the official reading at 8:30 GMT.
United States
Initial, Continuing Jobless Claims
The number of people in the United States, who filed for unemployment assistance for the first time during the business week ended on April 29th, probably increased to 260 000, according to market consensus, from 257 000 in the preceding week. If expectations were met, this would be the highest number of claims since the business week ended on April 1st, when a revised down 266 000 claims were reported.
The 4-week moving average, an indicator lacking seasonal effects, was 256 000, marking a decrease by 4 750 compared to the preceding weeks revised up average. It has been the lowest level since December 8th 1973, when the average was reported at 252 250.
The business week, which ended on April 22nd has been the 60th consecutive week, when jobless claims stood below the 300 000 threshold, which suggested a healthy labor market. It has been the longest streak in almost 43 years.
Initial jobless claims number is a short-term indicator, reflecting lay-offs in the country. In case the number of claims met expectations or increased further, this would have a moderate bearish effect on the US dollar.
The number of continuing jobless claims probably rose to the seasonally adjusted 2 133 000 during the business week ended on April 22nd, according to the median forecast by experts, from 2 130 000 in the preceding week. The latter has been the lowest level since November 4th 2000, when 2 110 000 claims were reported. The figure also represented a decrease by 5 000 compared to the revised down number of claims reported in the week ended on April 8th. This indicator reflects the actual number of people unemployed and currently receiving unemployment benefits, who filed for unemployment assistance at least two weeks ago.
The US Department of Labor is to release the weekly report at 12:30 GMT.
Fed Speakers
At 15:30 GMT the Federal Reserve President for St. Louis, James Bullard, is expected to take a statement, followed by the Fed President for Atlanta, Dennis Lockhart, and the Fed President for San Francisco and also a FOMC member, John Williams, both scheduled to speak at 23:15 GMT. Market players will be paying a close attention to their remarks in search of hints regarding the Feds policy tightening cycle.
Daily and Weekly Pivot Levels
By employing the Camarilla calculation method, the daily pivot levels for GBP/USD are presented as follows:
R1 – 1.4515
R2 – 1.4525
R3 (range resistance) – 1.4535
R4 (range breakout) – 1.4566
S1 – 1.4495
S2 – 1.4484
S3 (range support) – 1.4475
S4 (range breakout) – 1.4445
By using the traditional method of calculation, the weekly pivot levels for GBP/USD are presented as follows:
Central Pivot Point – 1.4561
R1 – 1.4723
R2 – 1.4832
R3 – 1.4994
S1 – 1.4452
S2 – 1.4290
S3 – 1.4181
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