Trading news

GBP/USD: general analysis

Current trend 

Yesterday the Pound continued to strengthen against the USD amid negative data on the US real estate market. However, the rise in pair was limited by a strong resistance level of 1.6550. Inflation data, which became known yesterday, put pressure on the British currency. It also became known that consumer price index fell by 0.2% to the level of 1.7% in February, while the target level set by the Bank of England is 2%.

This week, investors will pay attention to the final assessment of the gross domestic product in the UK. It is expected that GDP will remain unchanged at the level of 0.7%, while balance of payment, which is scheduled for the release too, may reduce to -13.5 billion pounds, which will support national economy.

Support and resistance

Technical indicators give mixed signals. MACD histogram is in the negative zone, the signal line is crossing the zero line from top to bottom, forming a sell signal. Stochastic is leaving overbought zone; its lines are crossing and moving upwards, giving a buy signal.

Resistance levels are 1.6550 (moving average with the period 55), 1.6600 (important psychological level),  1.6666 (local highs) and 1.6700. Support levels: 1.6480 (local lows) and 1.6428 (moving average with the period 100).

Trading tips 

It is recommended to open short positions after breakdown of the level of 1.6480 with stop-loss at 1.6470 and a target of 1.6380. Long positions can be placed above the level of 1.6550 with take profit at 1.6600. 

 

Andrey Cherkas

Analyst of LiteForex Group of Companies

Wednesday, 26 Mar, 2014 / 10:11

Source : http://www.liteforex.com/

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