US retail sales data released in the New York session yesterday showed a dismal reading for December, halting the previous strengthening of the US dollar.
In the European session today (Friday), UK retail sales data also influenced the Pound's trading for the week to end.
The market was surprised when the forecasted figure rose to 0.4% instead fell to -0.3% showing a significant contraction in December.
Investors watched the reaction of the published data to the movement on the GBP/USD currency pair chart.
After a rather aggressive movement last Wednesday when US inflation data was in focus, the price slowly returned to hovering around 1.22000.
Briefly testing the important zone, the price rebounded slightly in the New York session yesterday as the US dollar weakened following the retail sales data.
The price increase reached around 1.25600 before leveling off and slowing down until continuing the opening of the Asian session today.
In the European session, the price has fallen to break through the 1.22000 level following the declining UK retail sales data.
The price tends to continue the decline lower towards the support zone at 1.21000.
The level was tested during the decline at the beginning of last week before bouncing back.
For the expectation of a price increase if it breaks through 1.22000 again, the resistance is at the 1.23000 level to be tested again as achieved in trading last Wednesday.
Breaking through that barrier, the price will show a bullish signal for the price which pushes the increase to continue towards the next target at 1.24000.
