GBP/USD rallied at the moment of writing as the Dollar Index slipped lower despite the US data came in better than expected. The pair moved sideways trying to accumulate more bullish energy and attract more buyers.
The Dollar Index has failed to confirm an important rebound. The index seems to be very heavy, so a further drop may signal USD depreciation versus its rivals. GBP/USD is likely to approach and reach new highs if DXY drops deeper.
The Durable Goods Orders and the Core Durable Goods Orders have come in better than expected but failed to boost the greenback. The Prelim GDP may be decisive tomorrow. It is expected to increase by 6.7% versus 6.5% in the previous reporting period. Also, the Unemployment Claims indicator is expected to drop further from 348K to 345K.
GBP/USD consolidation
GBP/USD was moving sideways above the weekly pivot point of 1.3699. It's trapped between 23.6% and 38.2% retracement levels. If the price escapes from this range, making an upside breakout above the 38.2% level, it will signal an upside continuation.
The pair has retested the lower median line (LML), so the current sideways movement may represent an accumulation, a continuation pattern. GBP/USD is expected to resume its growth as long as it stays within the ascending pitchfork's body.
Forecast
Jumping and closing above 1.3747, through 38.2% retracement level is seen as a bullish signal. The immediate target is around the psychological level of 1.38. The major upside target is seen at the median line (ML).
