Yesterday, as the US dollar index strengthened by 0.53%, the British pound fell by 27 pips. However, this decline could already be offset during today's Asian session, as yesterday's US data came out weak: industrial orders for April dropped by 3.7%, core durable goods orders shrank by 7.5%, and car sales fell by 9.38% for the month.

After the price consolidates above the 1.3635 level (a consolidation is necessary because the price channel line is located above this level), the target of the upper boundary of the channel around 1.3790 will open up — or slightly higher, the target level of 1.3834.

On the four-hour chart, the price repeated a false breakout pattern below the MACD line. The Marlin oscillator's upward reversal from the zero line suggests that a third false dip below the MACD line is now unlikely.

The UK's May business activity indicators will be published today. The Services PMI forecast is 50.2 versus 49.0 in April, and the Composite PMI forecast is 49.4 versus April's 48.5. We expect the price to reach the first target of 1.3635.