- The British Pound remained confined in a range, and trading above a major support of 1.2930-20 against the US Dollar.
- The GBP/USD pair recently failed to break a major bearish trend line at 1.3010 on the hourly chart.
- The UK’s Gross Domestic Product Preliminary reading for Q1 2017 released by the National Statistics posted an increase of 0.2% (QoQ).
GBP/USD Technical Analysis
The British Pound crawled above the 1.3030 level against the US Dollar, but failed to retain the bullish traction. Later, the GBP/USD pair corrected lower in a couple of swing moves towards 1.2900.
Recently, the pair traded back towards the 1.3020 level where it faced sellers. A major bearish trend line at 1.3010 on the hourly chart acted as a resistance.
The pair moved down and traded below 1.3000 for a move towards a bullish trend line.
GBP/USD Hourly Chart
It is currently attempting a recovery, but the 38.2% Fib retracement level of the last decline from the 1.3012 high to 1.2937 low is acting as a resistance at 1.2967.
It looks like the pair may struggle to move above 1.2970 in the short term and could retest 1.2930-20 support.
As long as there is no daily close below 1.2900, the pair remains supported and may continue to challenge resistances near 1.3020 and 1.3040.
UK’s Gross Domestic Product
Today in the UK, the Gross Domestic Product Preliminary reading for Q1 2017 was released by the National Statistics. The market was expecting an increase of 0.3% in the GDP in Q1 2017, compared with the previous quarter.
The actual result was lower than the forecast, as the GDP posted an increase of 0.2%. In terms of the yearly change, there was a rise of 2%, which was also lower than the 2.1% forecast.
The report highlighted that:
UK GDP growth slowed to 0.2% in Quarter 1 2017 as consumer facing industries such as retail and accommodation fell and household spending slowed. This was partly due to rising prices. Construction and manufacturing also showed little growth, while business services & finance continued to grow strongly.
Overall, the GBP/USD pair may remain under pressure, but the 1.2930-20 support could act as a barrier for sellers.