Retail sales in the UK showed a fantastic growth of 7.2% in annual terms, despite the fact that they fell by -3.7% in the previous month. However, the market seemed to have ignored this. The thing is that there are more and more extremely uncomfortable questions about British statistics recently. So, the retail sales data also raises some doubts. After all, the data turned out to be much better than forecasts, which were already extremely optimistic: it promised an increase of 4.0%. In general, there are some doubts about the adequacy of the latest data. Moreover, certain restrictive measures imposed due to the coronavirus pandemic are still in effect. Ergo, it is not very clear where this impressive increase in retail sales came from.

Retail Sales (UK):

Since the retail sales data did not affect the pound at all, the preliminary data on business activity indices will remain disregarded. Investors still need to recover from such unexpected sales data. However, the index of business activity in the manufacturing sector may decline from 58.9 to 58.5, while the index of business activity in the service sector should grow from 56.3 to 59.1. As a result, the composite index of business activity may grow from 56.4 to 58.0.

Composite Business Activity Index (UK):

On the other hand, preliminary data on business activity indices in the United States will clearly bring a certain revival. Still, American statistics do not confuse investors. So, the index of business activity in the manufacturing sector should grow from 59.1 to 60.0, while the index in the service sector is likely to grow from 60.4 to 61.0. As a result, the composite business activity index may increase from 59.7 to 60.5. Thus, the dollar will clearly have a reason to end the week on a positive note.

Composite Business Activity Index (United States):

The GBP/USD currency pair showed a fairly high downward activity during the last trading day, as a result of which the pound weakened by more than 100 points, eventually touching the 1.3823 coordinate.

The market dynamics have again passed into the acceleration stage, where there is not just an inertial price movement, but also a high coefficient of speculative operations in the market.

If we proceed from the current position of the quote, we can see a slight pullback from the periodic pivot point of 1.3823, which can become a kind of regrouping of trading forces.

Looking at the trading chart in general terms, the daily period, the price rebound from the psychological level of 1.4000 is visible, which has a positive effect on the volume of short positions.

In this situation, we can assume that the variable pivot point will only hold back sellers for a while, letting the quote go into the pullback stage. But as soon as market participants manage to fix below 1.3820 in the four-hour period, we will have a chance for a subsequent downward movement in the direction of 1.3750.

From the point of view of a comprehensive indicator analysis, it can be seen that technical instruments on the hourly and daily periods signal a sale due to a downward cycle from the psychological level of 1.4000. Minute intervals have a variable buy/sell signal due to the rollback stage.