The GBP/USD pair dropped at the time of writing as the USD was lifted by the DXY's rally. The Dollar Index resumed growing after it ignored strong upside obstacles. In the short term, the bias remains bearish. It remains important to see how the currency pair will react to the UK economic data.
The Retail Sales indicator is expected to register a 0.6% drop in December versus a 1.4% rise in November. Also, the Gfk Consumer Confidence could drop from -15 points to -19 points. The British pound could be weakened by poor economic data.
GBP/USD False Breakout!
GBP/USD registered only a false breakout above the weekly pivot point (1.3650) level and above the median line (ML) signaling strong downside pressure. You already know from my articles that the currency pair could only test and retest the immediate upside obstacles before dropping deeper.
Technically, as long as it stays under the downtrend line, GBP/USD will remain bearish and it could extend its downside movement.
GBP/USD Forecast!
GBP/USD could activate a larger correction if it drops and closes below the 1.3573 low. A new lower low could bring us new selling opportunities.
