- – The British Pound is currently trading in a range against the US Dollar with resistance at 1.2500.
- – There is a major breakout pattern forming on the 4-hours chart of GBP/USD with support on the downside at 1.2350.
- – Today, the UK Gross Domestic Product released by the National Statistics posted an increase of 0.5% in Q3 2016 (preliminary).
UK Gross Domestic Product
Today in the UK, the Gross Domestic Product, which is a measure of the total value of all goods and services produced by the UK was released by the National Statistics.
The market was aligned for an increase of 0.5% in Q3 2016 (preliminary), compared with the previous quarter. The result was as forecasted, as the GDP grew by 0.5%. When we look at the yearly change, there was a rise of 2.3% in Q3 2016. Moreover, the Total Business Investment reported better than forecast increase of 0.9% in Q3 2016.
The report added that the “GDP in current prices increased by 0.8% between Quarter 2 2016 and Quarter 3 2016. GDP per head in volume terms was estimated to have increased by 0.3% between Quarter 2 2016 and Quarter 3 2016”.
Overall, the outcome was mostly in line with the forecast, and may help the British Pound in gaining traction in the short term.
GBP/USD Technical Analysis
The British Pound after trading towards the 1.2300 support area started to correct higher against the US Dollar. The GBP/USD pair moved higher, and traded above the 23.6% Fib retracement level of the last drop from the 1.2373 high to 1.2301 low.
It is currently attempting to close above the 100 simple moving average (H4). Looking at the 4-hours chart, there is a breakout pattern formed. On the upside there is a trend line with resistance at 1.2500. On the downside, the support trend line is at 1.2350. Both trend lines are contracting, and may soon provide us the next break.
Looking at the wave count, the chances of an upside break are a lot. So, if there is a break above 1.2500, it may open the doors for further gains in GBP/USD.
Tags: British Pound, GBP/USD Technical Analysis, UK GDP, US Dollar