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GBP/USD Remains In Uptrend Above 1.3000

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Technical analysis of Forex market

Key Highlights

  • The British Pound remains well supported above the key 1.3000 support against the US Dollar.
  • A major bullish trend line is in place with support at 1.3040 on the daily chart of GBP/USD.
  • The NY Empire State Manufacturing Index in April 2019 increased from 3.7 to 10.1.
  • The UK Claimant Count in Feb 2019 could change 20K, less than the last 27K.

GBPUSD Technical Analysis

The British Pound formed a strong support base near 1.2980 against the US Dollar. The GBP/USD pair is likely to climb higher above the 1.3150 and 1.3200 resistance as long as it is above 1.3000 and 1.2980.

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Looking at the daily chart, the pair declined this past week, but the all-important 1.2980 area acted as a strong support along with the 200-day simple moving average (green).

The chart clearly suggests the significance of the 1.2980 support, below which bears are likely to take control in the medium term. There is also a major bullish trend line is in place with support at 1.3040 on the same chart.

At the moment, the pair is trading with a positive angle and it could surpass the 1.3150 resistance in the near term. The next resistance is near the 1.3180 level and the 50% Fib retracement level of the last slide from the 1.3381 high to 1.2977 low.

If there is an upside break above 1.3180 and 1.3200, the pair could continue to rise towards the 1.3300 resistance area. On the downside, the main support is at 1.2980, below which there is a risk of a sharp drop towards the 1.2840 support.

Fundamentally, the NY Empire State Manufacturing Index for April 2019 was released by the Federal Reserve Bank of New York. The market was looking for an increase from 3.7 to 6.0.

The actual result was better than the forecast, as the NY Empire State Manufacturing Index climbed sharply to 10.1. There was a slight increase in new orders, and shipments continued to rise modestly. Delivery times and inventories both grew in April 2019.

Overall, GBP/USD remains in an uptrend as long as it is above 1.2980 and it could rise towards 1.3200 or even 1.3300 in the coming days.

Economic Releases to Watch Today

  • German ZEW Business Economic Sentiment Index for April 2019 – Forecast 0.8, versus -3.6 previous.
  • UK Claimant Count Change Feb 2019 – Forecast 20.0K, versus 27.0K previous.
  • UK ILO Unemployment Rate Feb 2019 (3M) – Forecast 3.9%, versus 3.9% previous.
  • US Industrial Production March 2019 (MoM) – Forecast 0.2%, versus 0% previous.

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