Forex Trading: GBPUSD Technical Analysis – January 09, 2020
The Great Britain Pound (GBP) inched higher against US Dollar (USD) on Thursday, after major economic news broke. This caused a price to increase more than 10 pips thereby totaling it to near 1.3100. As far as technical bias is concerned, it might remain bearish because of the higher low printed in the recent upside move.
GBP/USD: Technical Analysis
As of now, the GBPUSD is being asked for the price near 1.3107. The price may face resistance around multiple levels while moving upside. The first resistance may come across the price around 1.3144, it’s a confluence of a major horizontal resistance and trend line which is likely to act as a strong resistance and may push the price back towards the downside. Another resistance may hit the price near 1.3165, the trend line resistance and then comes 1.3514, the high of December 13, 2019, which may not allow the price to pass through the said level as shown in the graph below.
Coming towards the downside, the support levels may help the price to sustain around current levels and help it appreciating above the said levels such as the price may receive a strong support near 1.2919, the major horizontal support ahead of 1.2770, the trend line support 1.2551, the 61.8% Fib level support may prevent the price from falling further as shown in the graph above.
Great Britain Consumer Price Index Release
From a fundamental perspective, The (CPI) Consumer Price Index put forwarded by the National Statistics measures the price movements by comparing the retail prices after selecting samples from the different representative baskets of services and goods. The purchasing power of GBP is affected adversely by inflation. The CPI is considered as a key indicator to measure inflation and changes in purchasing trends. Generally speaking, a high reading suggests the positive or bullish market for the GBP and vice versa.
Keeping in view the price movement of the pair over the past few days, trading it for a short term position may not be a good idea.