GBPUSD WEEKLY OUTLOOK

Last week Fibonacci  retracement result moved as predicted

FUNDAMENTAL BEAM

The pound’s slide continues, as GBP/USD lost about one cent this week. The pair closed at 1.5946, marking the first week the pair has closed below 1.60 since early September. This week’s key events are CPI, Claimant Count Change and Retail Sales. 

The pound took a mid-week hit, following a poor Manufacturing Production release. As well, the trade deficit was well above the estimate. The US posted a weak consumer confidence release on Friday, but the pound was unable to take advantage.

Updates:

• Taking it to the wire: Idea of the Day So we are still waiting for the US to sort itself out.
• GBP/USD: Trading the British Retail Sales: British Retail Sales is considered one of the most important consumer spending indicators and is often a market-mover. A reading that is higher...
• GBPUSD Is Looking Bearish Against 1.6260-Elliott Wave Forecast: GBPUSD is very slow and choppy above the 1.5900 level so we think that a move from the latest low...
• GBP/USD: Bounces off uptrend support on excellent job figures – retracement over?: The UK published excellent job figures once again, which continue a previous trend of improvements. GBP/USD rose back above 1.60,...
• US politicians very close to a deal – USD jumps against majors: There are reports from Washington that a deal is getting closer: the more moderate Republicans in the Senate are getting...
• Deal but no big deal: Idea of the Day The deal was done late yesterday, ending the US government shutdown and extending the debt ceiling...
• US jobless claims remain high at 358K: US jobless claims dropped to 358K, within expectations. They were expected to drop to 357K from the big leap to...
• Risk sentiment boosted by Boehner’s “unconditional surrender”: Although markets had been fairly optimistic a deal in Washington would get done before the “x-date” of October the 17th,...

A Summary of key events during the week;

1. CPI: Tuesday, 8:30. CPI is one of the most important economic indicators and this release can have a major impact on the movement of GBP/USD. CPI has been fairly steady in recent readings, with the previous release of 2.7 matching the forecast. A similar reading is expected in the September release, with an estimate of 2.6%.
2. PPI Input: Tuesday, 8:30. Producer Price Input is a key release which measures inflation in the manufacturing sector. Unlike CPI, this inflation indicator tends to show some volatility. The estimate for the upcoming release stands at -0.1%.
3. RPI: Tuesday, 8:30. Retail Price Index is similar to CPI, but includes housing costs, which are excluded from CPI. The market has been posting gains slightly above 3% in recent releases and this trend is expected to continue for the September release, with an estimate of 3.2%.
4. Claimant Count Change: Wednesday, 8:30. This critical indicator has been improving recently and the August release posted a sharp drop of -32.6 thousand, easily beating the estimate of -21.2 thousand. Another strong drop is anticipated in September, with a forecast of -24.3 thousand. Will the indicator again beat the estimate? The Unemployment Rate is expected to remain at 7.7%.
5. Average Earnings Index: Wednesday, 8:30. Average Earnings looks at the change in price that government and businesses are paying fro labor. The indicator dropped to 1.1% last month, and a similar reading is expected in the upcoming release, with an estimate of 1.0%.
6. Retail Sales: Thursday, 8:30. Retail Sales is considered the most important consumer spending indicators, and should be treated as a market mover. The indicator disappointed in August, declining by 0.9%. The markets are expecting a turnaround in September, with the estimate standing at 0.5%.

TECHNICAL BEAM

GBPUSD coming from a low of 1.4820 since 11th of july this year and haven made a high of 1.6727 

previously dated back to 29th of april 2011. we expect this pair to move above a 9-months high of 1.6334 recorded on the 3rd of January 2013. It obviously looks bullish on the daily timeframe targeting a 100% Fibonacci level at 1.7341. Hence, market prices are expected to climb to 1.6787 on a weekly outlook for a first target and for a second week running to 1.7439 that is!,  if trend remains thickly bullish.

After Completing 61% Fibonacci bullish retracement as earlier predicted;

Further north-east emerging  pattern is expected to establish more bullish race- Assian opening has so much to say about how far this pair would go this week.

.A chart showing the future most likely behaviour for GBPUSD

NOTE: Price predictions produced by FibonacciPrice&PatternTrader may be affected by unforseen events like hurricane, earth quake, flood and other natural disasters consequently changing price patterns already predicted. Hence we advice strict adherence to money management techniques.

HAPPY TRADING