GBPUSD – Can British Pound Stay Above 1.2850 Vs US Dollar?
Aayush Jindal
Key Highlights
The British Pound after struggling to remain above the 1.2950 resistance against the US Dollar moved down.
The GBPUSD pair is trading above a major bullish trend line with support at 1.2870 on the 4-hours chart.
Today in the UK, the British Retail Consortium (BRC) Shop Price Index for April 2017 (YoY) posted a decline of 0.5%.
Today in the US, the all-important Fed Interest Rate Decision is lined up with an expectation of 1%, versus 1% previous.
GBPUSD Technical Analysis
The British Pound had a good last week against the US Dollar, as it moved above 1.2900. Later, the GBPUSD pair found resistance near 1.2965 and currently under minor bearish pressure.The pair has already moved below the 23.6% Fib retracement level of the last wave from the 1.2756 low to 1.2965 high. So, there is a chance of further declines towards 1.2830-40.At the moment, the pair is trading above a major bullish trend line with support at 1.2870 on the 4-hours chart. A close below it may call for a move below 1.2850 in the near term.The next support in the mentioned scenario could be around the 61.8% Fib retracement level of the last wave from the 1.2756 low to 1.2965 high at 1.2836.On the upside, the 1.2950-60 area is a monthly pivot and a major resistance for buyers. A break above it could take the pair towards 1.3050.
UK’s BRC Shop Price Index
Recently in the UK, the British Retail Consortium (BRC) Shop Price Index for April 2017 was released. The market was aligned for a decline of around 0.6% in the index in April 2017, compared with the same month a year ago.The actual result was a bit better, as the decline in the Shop Price Index for April 2017 was 0.5%.
Economic Releases to Watch Today
Germany’s Unemployment Change for April 2017 - Forecast -12K, versus -30K previous.
Germany’s Unemployment Rate for April 2017 – Forecast 5.8%, versus 5.8% previous.
UK’s Construction PMI for April 2017 – Forecast 52.0, versus 52.2 previous.
Euro Zone Gross Domestic Product Q1 2017 (Preliminary) (QoQ) - Forecast 0.5%, versus 0.4% previous.
US Services PMI for April 2017 – Forecast 52.4, versus 52.5 previous.
US ADP Employment Change April 2017 - Forecast 180K, versus 263K previous.
Fed Interest Rate Decision - Forecast 1%, versus 1% previous.
The pair has already moved below the 23.6% Fib retracement level of the last wave from the 1.2756 low to 1.2965 high. So, there is a chance of further declines towards 1.2830-40.At the moment, the pair is trading above a major bullish trend line with support at 1.2870 on the 4-hours chart. A close below it may call for a move below 1.2850 in the near term.The next support in the mentioned scenario could be around the 61.8% Fib retracement level of the last wave from the 1.2756 low to 1.2965 high at 1.2836.On the upside, the 1.2950-60 area is a monthly pivot and a major resistance for buyers. A break above it could take the pair towards 1.3050.