GBP/USD Forecast – British Pound Looking To Gain Traction Vs Dollar

GBP/USD Forecast – British Pound Looking To Gain Traction Vs Dollar

  • – The British Pound after a nasty decline found support near 1.2140 against the US Dollar.
  • – The GBP/USD pair is currently recovering, and facing a major resistance trend line at 1.2180 on the hourly chart.
  • – The UK’s Trade Balance figure for Jan 2017 released by National Statistics posted a trade deficit of £-2.447B, less than the forecast of £-2.50B.

 

UK Trade Balance

Today in the UK, the Trade Balance figure for Jan 2017 was released by National Statistics. The market was expecting the balance between exports and imports of total goods and services to be £-2.50B in Jan 2017.

 

The outcome was better than the forecast, as the UK’s Trade Balance posted a trade deficit of £-2.447B. The good trade balance was also above the forecast with deficit of £-10.833B in Jan 2017. The report mentioned that “Between the 3 months to October 2016 and the 3 months to January 2017, the total trade deficit (goods and services) narrowed by £4.7 billion to £6.4 billion”. In another release, the UK Industrial Production released by the National Statistics posted a rise of 3.2% in Jan 2017, compared with Jan 2016. It was a point lower than the forecast of 3.3%.

 

It looks like the British Pound is attempting a recovery, but might struggle to break the trend line resistance near 1.2180.

 

GBP/USD Technical Analysis

The British Pound struggled a lot lately and moved below 1.2200 against the US Dollar. The GBP/USD pair fell towards 1.2140 where it found support and started a consolidation. The pair traded in a range for some before moving higher.

 

GBP/USD Technical Analysis Pound US Dollar

 

It already made an attempt to settle above the 1.2200 handle, but failed. There was also a failure near the 38.2% Fib retracement level of the last decline from the 1.2300 high to 1.2133 low. At the moment, the pair is struggling to clear a major resistance trend line at 1.2180 on the hourly chart.

 

If there is a break above 1.2180, the pair might test the second trend line resistance at 1.2195, which also coincides with the 100 hourly simple moving average. On the other hand, if the pair fails once again, there can be a retest of 1.2140.

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