- The British Pound after trading as high as 1.3044 tumbled against the US Dollar before finding support at 1.2886.
- The GBPUSD pair recently broke a steep bearish trend line at 1.2950 on the hourly chart to ignite an upside move.
- The UK’s CBI Industrial Trends – Order Index for May 2017 was released by the Confederation of British Industry posted an increase from 4 to 9.
GBPUSD Technical Analysis
The British Pound was in a good shape this week as it moved above the 1.3000-1.3020 resistance area against the US Dollar. The upside move was strong, as the GBPUSD pair traded as high as 1.3044.
Later, there was a correction wave initiated, and the pair traded below the 50% Fib retracement level of the last wave from the 1.2870 low to 1.3040 high.
A low was formed at 1.2886 where the pair got support and later it started recovering.
GBPUSD Hourly Chart
It recently broke a steep bearish trend line at 1.2950 on the hourly chart. It has also cleared the 50% Fib retracement level of the last decline from the 1.3044 high to 1.2886 low.
At the moment, it is trading just above the 1.3000, and looking for a H4 close above the stated level.
A break and close above the 76.4% Fib retracement level of the last decline from the 1.3044 high to 1.2886 low might ignite further gains and a move towards 1.3050.
CBI Industrial Trends Orders Index
Today in the UK, the CBI Industrial Trends – Order Index for May 2017 was released by the Confederation of British Industry. The market was expecting no change in the index from the last reading of 4.
The actual result was a lot better than the forecast, as the CBI Industrial Trends index posted a rise from 4 to 9 in May 2017. It was via a survey of 432 manufacturers. As per the report, the total order books growth was the highest since February 2015.
The report added that:
Output growth picked up pace, seeing the fastest rise since December 2013. This was underpinned by the mechanical engineering and chemicals sectors. Firms expect another firm rise in production over the coming quarter.
Overall, the GBPUSD has hardly any reason to move down, which is why we can see more gains above 1.3000 in the near term.