GBP/USD Forecast – Cable Following a Bearish Path Below 1.2920

GBP/USD Forecast – Cable Following a Bearish Path Below 1.2920

  • – The British Pound is moving lower and positioned below the 1.2940-20 resistance against the US Dollar.
  • – There is a descending channel pattern with resistance at 1.2900 forming on the hourly chart of GBP/USD.
  • – Today in the UK, the British Retail Consortium (BRC) Like-For-Like Retail Sales for June 2017 was published.
  • – The outcome was positive, as there was an increase of 1.2% in the Retail Sales (YoY).

 

UK’s Consumer Credit

Recently in the UK, the British Retail Consortium (BRC) Like-For-Like Retail Sales for June 2017 was published. The market was positioned for a rise of 0.5% in the sales in June 2017 compared with the same month a year ago.

 

However, the actual result was positive, as there was an increase of 1.2% in the Retail Sales. It was a lot more compared with the last decline of 0.4%. When we consider the total basis, there was an increase of 0.2% in the sales, which was same as in June 2016. The report added that:

Over the three months to June, food sales increased 3.6 per cent on a like-for-like basis and 4.7 per cent on a total basis. This is the strongest 3-month average since February 2012, and pulls the 12-month total average growth to 2.5 per cent, the highest since December 2013.

 

Overall, the result was positive, which may push the GBP/USD pair higher, but it is likely to remain capped by 1.2920-40.

 

GBP/USD Technical Analysis

The British Pound started a downside move from well above 1.3000 and traded below 1.2980 against the US Dollar. The GBP/USD pair declined slowly and moved below the 1.2950, 1.2940 and 1.2920 support level.

 

GBP/USD Technical Analysis British Pound US Dollar

 

The pair traded as low as 1.2854 recently and currently consolidating. Looking at the hourly chart, the pair is following a descending channel pattern with resistance at 1.2900. At the moment, buyers are attempting a close above the 23.6% Fib retracement level of the last decline from the 1.2983 high to 1.2854 low.

 

Above the channel resistance, the 100 hourly simple moving average is a major hurdle at 1.2918. It also coincides with the 50% Fib retracement level of the last decline from the 1.2983 high to 1.2854 low.

 

There is also a bearish trend line on the upside at 1.2940, waiting to act as a barrier if the pair jumps higher in the near term. Overall, there can be corrections in GBP/USD, but upsides could be limited by 1.2920-40.

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