Current trend
The Pound continues to rise in price. Currently the price has exceeded the highs of 10 April at the level of 1.6819. If British currency maintains at this level, uptrend will continue. Note, however, that Williams Percent range indicator, which has maintained at the highest level (-2.8369), shows that the currency is oversold and technical correction is pretty possible.
The rise in the Pound was caused by positive macro-statistics. Unemployment rate in February fell to the level of 6.9%, which is below the target level of 7.0%. This record has been reached for the first time since 2009. Earlier the Bank of England has planned to change key interest rate after reaching a target level, however now this index seems not the most important fact for changing interest rate. If British economic data continues to show positive dynamics, the Bank of England may tighten monetary policy soon, which will encourage the rise in the Pound.
Support and resistance
The nearest resistance level is 1.6850 – 8/8 of Murrey level.
Support level is 1.6660 – bottom limit of the trading channel.
Trading tips
It is recommended to open long positions after breakdown of the level of 1.6850 with stop-loss at 1.6810 and a target of 1.6920.
Dmitry Agurbash
Analyst of LiteForex Group of Companies
