GBPUSD Plunges Despite Upbeat UK Data

FXOpen

The Great Britain Pound (GBP) extended downside movement against the US Dollar (USD) on Wednesday, dragging the price of GBPUSD to less than 1.3125 following the release of some key economic news from Britain. The technical bias remains bearish because of a Lower Low in the recent wave on a daily chart.

Technical Analysis

As of this writing, the pair is being traded near 1.3105. A support may be noted around 1.2796-1.2800, which is the confluence of a psychological number as well as the low of the latest major downside move as demonstrated in the given below daily chart. A break and daily closing below the 1.2800 support area could incite the renewed selling pressure, validating a move towards the 1.2500 support area in the long run.

GBPUSD Plunges Despite Upbeat UK Data

On the upside, the pair is likely to face a hurdle near 1.3475, a major horizontal resistance area ahead of 1.3533, the high of June 29th and then 1.3844, another major horizontal resistance area. The technical bias will remain bearish as long as the 1.5017 resistance area is intact.

UK Consumer Price Index

The Consumer Price Index (CPI) – a key gauge for inflation – rose more than expected in Britain, a government report said yesterday. The CPI rose to 0.5% in July as compared to 0.3% in the same month of the year before, according to a report by the Office of National Statistics. Analysts had predicted a reading of 0.4%, according to a survey conducted by Bloomberg. Generally speaking, a higher CPI reading is considered positive for the economy and vice versa. CPI reports are closely monitored by the Monetary Policy Committee (MPC) members in decision making particularly interest rate and quantitative easing decisions.

Trade Idea

Considering the overall technical and fundamental outlook, selling the pair on short term rallies appears to be a good strategy for intraday trading.

Trade over 50 forex markets 24 hours a day with FXOpen. Take advantage of low commissions, deep liquidity, and spreads from 0.0 pips. Open your FXOpen account now or learn more about trading forex with FXOpen.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

Latest from Forex Analysis

Commodities and European currencies Test Key Supports EUR/USD Analysis: The Price Today Has Set Its Minimum Since the Beginning of March Market Analysis: GBP/USD Dives While USD/CAD Gains Bullish Pace The US Currency Corrects After Recent Growth USD/JPY Price Analysis: Consolidation ahead of US News

Latest articles

Commodities

Market Analysis: Gold Price and Crude Oil Price Gain Bullish Momentum

Gold price started a steady increase above the $2,200 resistance level. Crude oil prices are gaining bullish momentum and might rise toward $85.00.

Important Takeaways for Gold and Oil Prices Analysis Today

· Gold price started a decent increase

How Do Grid Trading Strategies Work?
Trader’s Tools

How Do Grid Trading Strategies Work?

Grid trading stands as a distinctive strategy within the trading realm, offering a structured approach to navigating market volatility. By strategically placing buy and sell orders at predefined intervals, this method eschews the need to determine the market direction, instead

Weekly Market Wrap With Gary Thomson: NIKKEI-225, USD/JPY, GBP/USD, USD/CAD, Gold
Financial Market News

Weekly Market Wrap With Gary Thomson: NIKKEI-225, USD/JPY, GBP/USD, USD/CAD, Gold

Get the latest scoop on the week's hottest headlines, all in one convenient video. Join Gary Thomson, the COO of  FXOpen UK, as he breaks down the most significant news reports and shares his expert insights.

  • NIKKEI-225 Analysis Indicates Possibility

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 65.68% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.