Key Highlights
- The British Pound corrected higher and broke the 1.2850 resistance against the US Dollar.
- There is a crucial bearish trend line formed with resistance at 1.2970 on the 4-hours chart of GBP/USD.
- UK’s Rightmove House Price Index for Feb 2019 increased 0.2% (MoM), less than the last +0.4%.
- The UK Claimant Count figure for Feb 2019 will be released today, which could change by 2.4K.
GBPUSD Technical Analysis
The British Pound found support near the 1.2770-1.2780 zone after a significant decline against the US Dollar. The GBP/USD pair started a decent rebound and corrected above 1.2850 and 1.2900.
Looking at the 4-hours chart, the pair traded as low as 1.2772 and later recovered above the 23.6% Fib retracement level of the last decline from the 1.3217 high to 1.2772 low. The pair also broke a connecting bearish trend line at 1.2890 on the same chart.
The upward move was strong as the pair surpassed the 1.2900 resistance and the 200 (green) simple moving average (4-hours). However, there is a strong resistance formed near the 1.2970-1.2980 zone.
There is also a crucial bearish trend line formed with resistance at 1.2970. Above the trend line, the main resistance is 1.3000 and the 50% Fib retracement level of the last decline from the 1.3217 high to 1.2772 low.
Therefore, the GBP/USD pair is likely to face a strong resistance near the 1.2970 and 1.3000 levels. A successful close above 1.3000 could start a strong uptrend towards 1.3100 and 1.3150 in the near term. Alternatively, if buyers fail near 1.2970 or 1.3000, the pair could restart its decline back towards 1.2850 and 1.2800.
Looking at the other major pairs, EUR/USD succeeded in clearing the 1.1315 resistance, but it could struggle near 1.1350 and 1.1360. AUD/USD also rebounded recently and broke the 0.7120 resistance area.
Economic Releases to Watch Today
UK Claimant Count Change Feb 2019 – Forecast 2.4K, versus 20.8K previous.
UK ILO Unemployment Rate Dec 2018 (3M) – Forecast 4.0%, versus 4.0% previous.
German ZEW Business Economic Sentiment Index Feb 2019 – Forecast -13.4, versus -15.0 previous.
