The UK Retail Sales With Auto Fuel released this morning has been worse than market expectations. The global investors expected an increase of 0.5% after a -1.4% drop last month, but the numbers revealed were at the level of 0.1% only. Moreover, on a yearly basis, the figures increased only from 1.5% to 1.6%, while the market participants expected an increase to 2.5%. As a result, sales would need to rise by around 1.0% over the next two months in order to provide the same support to the GDP growth that it did in Q4. The good news that the figures were boosted by a rise in non-food sales, thanks to people's New Year's resolutions to "get fit and lose weight". "Feedback from retailers suggested that New Year's resolutions to "get fit and lose weight" contributed to this increase in sales when compared with the previous year," the researchers from the Office for National Statistics said. "Growth in the quantity of sporting equipment, games and toys was offset by falling of food sales when compared with the same month of the previous year," added Rhian Murphy, a senior statistician at the ONS."Sporting equipment sales have grown more than usual in January 2018, following an increased uptake for gym wear." - he added.
Well, it would be better for UK citizens to get in shape as the figures are not particularly encouraging.
Let's now take a look at the GBP/USD technical picture at the H4 time frame. The market tried to rally just before the data release, but it just hit the golden trend line of dynamic resistance and then reversed after the disappointing data were released. So, the temporary local high was made at the level of 1.4145, and now the price will test the support at the level of 1.4066 and then possibly at the level of 1.3986. The down-pointing momentum indicator in the overbought market conditions is supporting the bearish outlook.
