The GBP/USD pair closed last week near the highest of its latest range, but still limited below the 1.5670/80 region, where selling interest has been containing advances since early July.
There was no relevant macroeconomic data in the UK to guide investors, but the Pound continued finding some support on the idea that the BOE will enter the tightening path after the FED, probably in the first half of 2016.
Technically, the 4 hours chart shows that the price is above a bullish 20 SMA, although the technical indicators have turned lower, with the Momentum indicator about to cross its 100 level towards the downside.
In the same chart, the 200 EMA remains horizontal, reflecting the ongoing lack of directional strength, around 1.5670. Overall, market’s sentiment favors the upside, yet some follow through beyond 1.5710 is required to confirm additional gains for the upcoming sessions.
Meanwhile the GBP/CAD extended its advance on Friday, mostly on Pound’s strength. An intraday advance in oil prices, was finally erased by the US Baker Huge report, showing that the number of rigs drilling for oil in the United States rose by 2 from the previous week, bringing the total to 672.
Additionally, during the past week, the OPEC reported that its output rose to a 3-year high in July, with Iran among the biggest producers, all of which helped maintain the oil under pressure, and therefore, the Canadian dollar.
As for the GBP/CAD, the daily chart shows that the price has extended above its 20 SMA, whilst the technical indicators present limited upward strength above their mid-lines, supporting some further gains in the cross.
In the 4 hours chart, the upward potential seems limited, as the technical indicators are losing their upward strength above their mid-lines, whist the price stands above a horizontal 20 SMA.