Important data on the UK economy is expected during the week.
Tomorrow data on the Current Account is due. According to forecasts, in November the budget deficit increased by about 4.7 billion Pounds. On Wednesday, data on the third quarter GDP is out. The figure is expected to remain at 0.5%, unchanged from the previous quarter. At the same time, latest data on consumer showed a near-zero growth, while producer price indices significantly fell.
Therefore, absence of growth and poor macroeconomic statistics shift the expectations of tightening in the UK to the second half of 2016 that will continue pressuring the pair.
Support and resistance
On the , the pair is falling towards the lower border if a near the level of 1.4860.
An upward correction in the pair could continue up to the levels of 1.5000 (EMA50 on the 4-hour chart), 1.5085 (EMA144), 1.5120 (EMA200), 1.5230 (23.6% Fibonacci correction and upper border of the ). At the same time, a breakdown of the level of 1.4860 will accelerate the fall towards 1.4800, 1.4750 and 1.4600 (year lows).
On the daily and weekly charts, OsMA and recommend short positions, while on the 4-hour chart the indicators are turning to purchases.
Support levels: 1.4860, 1.4800, 1.4750.
Resistance levels: 1.4960, 1.5000, 1.5085, 1.5100, 1.5120, 1.5230.
Open short positions from current prices with targets at 1.4860, 1.4800, 1.4750 and stop-loss at 1.4930.
Long positions can be opened from the level of 1.4940 with targets at 1.5000, 1.5085, 1.5100, 1.5120, 1.5190 and stop-loss at 1.4890.