GBP/USD: correction after the publication of US inflation data
Current trend
During the Asian session, the GBP/USD pair is falling, testing the level of 1.3520 for a breakdown.
The development of corrective dynamics at the end of the week is due to the appearance of strong US statistics on inflation, which forces investors to act ahead of the curve. There is practically no doubt that the US Federal Reserve will start a cycle of raising interest rates during the March meeting. Now the whole question is how fast the US regulator will tighten its monetary policy and whether the risks of rising consumer prices were correctly assessed from the very beginning.
Meanwhile, British investors expect on Friday a block of macroeconomic statistics from the UK on GDP dynamics for the fourth quarter. Forecasts suggest some slowdown in the indicator from 6.8% to 6.4%. Also, December data on the dynamics of industrial production and an estimate of GDP growth rates from NIESR for January 2022 will be published during the day.
Support and resistance
On the daily chart, Bollinger Bands move flat. The price range narrows slightly, remaining quite spacious for the observed trading dynamics for the instrument. MACD falls, keeping a poor sell signal (the histogram is below the signal line). Stochastic shows a more confident decline, quickly approaching its lows, indicating that the pound may become oversold in the ultra-short term.
Resistance levels: 1.3550, 1.3600, 1.3650, 1.3700.
Support levels: 1.3500, 1.3460, 1.3435, 1.3400.
During the Asian session, the GBP/USD pair is falling, testing the level of 1.3520 for a breakdown.
The development of corrective dynamics at the end of the week is due to the appearance of strong US statistics on inflation, which forces investors to act ahead of the curve. There is practically no doubt that the US Federal Reserve will start a cycle of raising interest rates during the March meeting. Now the whole question is how fast the US regulator will tighten its monetary policy and whether the risks of rising consumer prices were correctly assessed from the very beginning.
Meanwhile, British investors expect on Friday a block of macroeconomic statistics from the UK on GDP dynamics for the fourth quarter. Forecasts suggest some slowdown in the indicator from 6.8% to 6.4%. Also, December data on the dynamics of industrial production and an estimate of GDP growth rates from NIESR for January 2022 will be published during the day.
Support and resistance
On the daily chart, Bollinger Bands move flat. The price range narrows slightly, remaining quite spacious for the observed trading dynamics for the instrument. MACD falls, keeping a poor sell signal (the histogram is below the signal line). Stochastic shows a more confident decline, quickly approaching its lows, indicating that the pound may become oversold in the ultra-short term.
Resistance levels: 1.3550, 1.3600, 1.3650, 1.3700.
Support levels: 1.3500, 1.3460, 1.3435, 1.3400.