The currency pair has edged higher and has managed to hit fresh new highs on the short term, has erased the yesterday’s losses and looks determined to climb even higher if the US dollar index will slide further. The GBP/USD has resumed the short rebound and is targeting some important upside targets, remains to see how will reach when will touch these levels.
Price has rallied aggressively as the dollar was punished by the USDX massive drop, the index has resumed the correction phase and looks unstoppable on the Daily chart. The USDX has ignored the 99.84 static support and could drop further if will stabilize below this level, a further drop will force the USD to lose more ground versus its major rivals.
The US dollar index could approach and reach the 99.24 previous low in the coming days, could find support also at the 99.12 level, personally I still believe that the index could move sideways in the coming weeks, this scenario will take shape only if will stay above the mentioned support levels.
The greenback has dropped further in the afternoon, even if the United States Current Account has increased from -116B to -112B in the fourth quarter, despite that the economists have predicted an increase to -129B.
The Cable has rallied today also because has received support from the United Kingdom data, we had some positive numbers that have boosted the Pound. The CPI rose by 2.3% In February, beating the 2.1% forecast, the indicator has continued to increase after the 1.8% growth in the previous reporting period, while the Core CPI surged by 2.0% in the previous month, exceeding the 1.7% estimate, has beaten also the 1.6% growth since January.
The Pound has received a helping hand also from the RPI, which has increased by 3.2% in February, beating the 2.9% estimate and the 2.6% growth in the previous reading period, while the Public Sector Net Borrowing surged from -11.7B to 1.1B, but has come better versus the 2.9B estimate. We have also some negative data from the United Kingdom today, but the Cable wasn’t impressed.

GBPUSDdaily

You can see that the price has rallied and has reached new highs, right now is very close to touch the first warning line (wl1) of the former ascending pitchfork, where he could find temporary resistance. The perspective remains bullish on the short term after the retest of the lower median line (lml) of the minor ascending pitchfork and after the failure to touch the extended sideways support from 1.0282 level. The currency pair continues to move sideways on the Daily chart, is located somewhere at the half of the narrow movement between the 1.0282 and the 1.2795 level, the next major upside target remains at the median line (ML) of the major descending pitchfork, could be attracted by the confluence area formed at the intersection between the ML with the wl1.

GBPUSDh4

The rate is trapped inside of an ascending channel on the H4 chart, so the perspective is bullish as long as will stay inside this channel, but we could have a minor retreat after the impressive rally. We could see a minor decrease and the rate could try to test the downside line of the minor ascending channel and also the broken downtrend line before will try to approach and reach the mentioned major resistance levels.

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