The economic data has been very light this morning, with the UK construction report being the only piece which stands out. The figure came out at 56 PMI points, a lot better than expected and more than 3 points above last month´s reading. The housing index and commercial index were at the highest for more than a year as well.
GBP/USD jumped about 30 pips after the release but lost them again soon and is now sliding lower. The 100 SMA (green) on the H1 chart is providing some sort of support. It did the same yesterday and the price jumped 90 pips higher after it failed to break this moving average. However, now it looks weak, so that´s why we´re not opening a buy forex signal down here.
I think it´s time the 100 SMA let go
The H4 chart is also pointing down. The 100 SMA, which comes just above 1.29, has turned into resistance in this timeframe chart, so the technical analysis paints a pretty bearish picture.
Add to this the impressive UK construction report and the fact that the Pound is even more bearish now after the release and the situation doesn´t look so bright for buyers.
The US employment report is up in about an hour, which might throw all this analysis off. But, that´s just how forex works. We try to play the market on historic data, then move on to the next release.
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