- The British Pound struggled a lot to break the 1.2985 resistance against the US Dollar.
- The GBPUSD pair moved down and broke two important bullish trend lines at 1.2930 on the hourly chart.
- The UK’s Industrial Production for March 2017 (MoM) released by the National Statistics posted a decline of 0.5%, more than the forecast of -0.3%.
GBPUSD Technical Analysis
The British Pound after trading towards 1.2985 faced heavy offers against the US Dollar, resulting in a decline. The GBPUSD pair corrected lower, and then once again retested the same 1.2985 resistance area.
Sellers again defended the mentioned resistance and pushed the pair below 1.2950. This can be considered as a perfect scenario of a double top pattern near 1.2985.
The pair recently broke the 38.2% Fib retracement level of the last wave from the 1.2829 low to 1.2985 high.
GBPUSD Hourly Chart
The most important move was below two important bullish trend lines at 1.2930 on the hourly chart, which is a major bearish sign.
At the moment, the pair is finding bids near the 50% Fib retracement level of the last wave from the 1.2829 low to 1.2985 high.
However, the same broken trend lines may now act as a resistance and prevent gains above 1.2940. A break below 1.2900 might materialize the double top pattern for further declines in GBPUSD.
UK Industrial and Manufacturing Production
Today in the UK, the Industrial and Manufacturing Production figures for March 2017 were released by the National Statistics. The market was expecting the Industrial Production to decrease by 0.3% in March 2017, compared with the previous month.
The actual result was a lot lower than the forecast, as the Industrial Production posted a decrease of 0.5%. The UK Manufacturing Production also disappointed and posted a decline of 0.6% in March 2017, compared with the previous month, which was a lot more than the forecast of 0%.
The report mentioned that:
The Index of Production for Quarter 1 (Jan to Mar) 2017 was estimated to have increased by 0.1%. Increases of 0.3% in manufacturing and 1.8% in mining and quarrying were offset by a fall of 4.3% in energy supply.
Overall, the GBPUSD pair is clearly under pressure, and may trade lower towards 1.2880 in the near term.