GBPUSD – British Pound In Clear Downtrend Vs Dollar
Aayush Jindal
Key Highlights
The British Pound dropped below 1.2300 against the US Dollar and remains in a downtrend.
The GBPUSD pair broke a major support trend line at 1.2430 on the 4-hours chart, which initiated a downside move.
Today in the UK, the British Retail Consortium (BRC) Like-For-Like Retail Sales for Feb 2017 (YoY) was released, which posted a decline of 0.4%.
Later today, the Halifax House Price Index for Feb 2017 will be released by the HBOS, which is forecasted to register a minor increase.
GBPUSD Technical Analysis
The British Pound struggled a lot recently vs the US Dollar, and a break below the 1.2400 support area ignited heavy downsides. The GBPUSD pair is now trading below 1.2300 and remains in a clear downtrend.Before the downtrend was initiated, the pair broke a major support trend line at 1.2430 on the 4-hours chart. The same trend line was also positioned around the 100 simple moving average (H4) at 1.2440. So, a close below 1.2400 was crucial, and ignited a solid downside move.The pair traded as low as 1.2214, and currently correcting higher. It recently tested the 23.6% Fib retracement level of the last decline from the 1.2569 high to 1.2214 low, where it found resistance.It is once again moving lower, risking a break below 1.2214. There is a chance of GBPUSD testing 1.2200 in the short term. And, if sellers gain pace, there can be a break of 1.2200 as well.
British Retail Consortium (BRC) Like-For-Like Retail Sales
Today in the UK, the British Retail Consortium (BRC) Like-For-Like Retail Sales for Feb 2017 (YoY) was released. The market was aligned for a rise of around 0.2% in the actual value of retail sales from participating companies.The outcome was negative, as there was a decline of 0.4%. Commenting on the retail sales report, the Chief Executive, British Retail Consortium, Helen Dickinson OBE, stated:
A fairly stable rate of online growth has again helped compensate for declines in stores. The online market has now grown to over 20 per cent of total non-food sales, and as a result growth of 8.0 per cent is understandable if not as impressive in previous years and helps explain the lowest 3-month average rate of year-on-year growth since May 2013.
Overall, the British Pound remains under pressure with a chance of a break below 1.2214.
Today’s Important Economic Releases
UK’s Halifax House Price Index for Feb 2017 (YoY) – Forecast +2.2%, versus +2.4% previous.
German Factory orders Jan 2017 (MoM) - Forecast -2.7%, versus +5.2% previous.
Euro Zone GDP for Q4 2016 (QoQ) - Forecast -2.7%, versus +5.2% previous.
Before the downtrend was initiated, the pair broke a major support trend line at 1.2430 on the 4-hours chart. The same trend line was also positioned around the 100 simple moving average (H4) at 1.2440. So, a close below 1.2400 was crucial, and ignited a solid downside move.The pair traded as low as 1.2214, and currently correcting higher. It recently tested the 23.6% Fib retracement level of the last decline from the 1.2569 high to 1.2214 low, where it found resistance.It is once again moving lower, risking a break below 1.2214. There is a chance of GBPUSD testing 1.2200 in the short term. And, if sellers gain pace, there can be a break of 1.2200 as well.