Cable inched higher against the greenback on Wednesday, taking the price to more than 1.5720, following the UK gross domestic product figure.

The GBP/USD is still consolidating between 1.5735 and 1.5589 since November 14 when it created a fresh yearly low at 1.5592. As of today, the price rallies after the release of UK’s growth figure.

Technical Analysis

As of this writing, the pair is being traded around 1.5715. The pair opened the Asian session at 1.5707 and found some buyers around the 1.5700 handle. On the upside, an immediate resistance can be noted around 1.5735, the level that is acting as resistance from the past few days. Breaking this level could open the doors towards 1.5815, the 38.2% fib level ahead of 1.5885 that’s the confluence of 50% fib level as well as major horizontal resistance on the daily timeframe. 

On the downside, 1.5625 is a major support which is preventing price to depreciate further since last two weeks. Breaking this support, the GBP/USD may print fresh yearly low.

UK Gross Domestic Product

The GDP figure of UK for the third quarter of this year remained 3%, in line with the median projection of analysts hence maintaining steady growth as compared to the same quarter of the previous year. 3.0% is a considerable growth figure which boosted the level of confidence among investors and consequently we saw a rally in the price of cable.

US Durable Goods Orders

The durable goods orders of US are expected to remain at -0.6% this October as compared to -1.1% in the month before, says the average forecast of different analysts. As an indicator of strong economy, a higher reading is considered bullish for the US dollar thus a better than expected figure might spur selling pressure in the price of GBP/USD.

Trade Idea

Considering the overall technical and fundamental outlook, buying cable around the current levels could be a good strategy in short to medium term as described above.

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.