GBPUSD falls towards 1.2350 mark, following disappointing British Retail Sales figures.

GBP plummeted versus the Euro, the US dollar, and various other key assets. When British retail sales numbers dipped to values that occurred during the epidemic restrictions.  Yet analysts predict a dramatic comeback as actual earnings improve.

GBPUSD Key Points & Considerations

GBPUSD remains over the psychological supporting mark of 1.2400.

A breakdown under the 8-day EMA may lead to a psychological ceiling of 1.2300 mark. The significant mark of 1.2450. Which corresponds to the 38.1 percent Fib retrace, could act as the important barrier zone.

After sales at retail were stated to have declined 2.4 percent year on year in the twelve months to Oct. A decrease from -1.5 percent in Sept and well below the average forecast of -1.5 percent. The British pound seemed poised for second weekly slide versus major rivals.

Selling were predicted to gain 0.3 percent month on month in the month of October.  Improving after being downwards adjusted -1.11 percent in September of this year, yet they fell by 0.3 percent.

These sales at retail numbers will reinforce market expectations that the BoE would lower interest rates many times in 2024.  Amid reaction to a weaker economy, significantly dragging on the British pound

According to the ONS, price rises tend to produce an imbalance among amounts purchased (weight) and sums paid (worth) in sales to retailers as time goes by. In reality, sales at retailer quantities in October of 2023 been the fewest after February of 2021. After wide-ranging and comprehensive Covid limitations took effect

UK Retail Sales Illustation

Regardless of a rise in sale value, customers are taking home fewer. Volumes and worth of sales, periodically revised, in Britain from October of 2019 to Oct of 2023 are depicted in the pictorial representation.

Source: ONS

Technical Analysis

The psychological mark of 1.2400 acts as immediate support, and then follows the psychological level of 1.2350, which is linked with the 9- (D-EMA) at 1.2353.

A test under that mark might put more pressure on the GBPUSD set. Perhaps guiding it towards the zone near the psychological mark of 1.2300, in tandem with its 21-day EMA of 1.2295 zone

Support and Resistance

S3 1.20368 S2 1.20368 S1 1.20689     R1 1.25055 R2 1.25055 R3 1.31418