GBP/USD Approaching Key Break, UK’s Budget Next13 March, 2018 by Aayush Jindal in Market Analysis
- The British Pound recovered nicely from the 1.3790 swing low against the US Dollar.
- There is a key contracting triangle forming with resistance at 1.3930 on the 4-hours chart of GBP/USD.
- The pair could make the next move either above 1.3930 or below 1.3840.
- Today, the UK Budget report will be released, which could ignite swing moves in GBP/USD.
GBPUSD Technical Analysis
The British Pound formed a support base just below 1.3800 against the US Dollar and recovered. The GBP/USD pair is now preparing for the next move with resistance at 1.3930 and support at 1.3840.
Looking at the 4-hours chart of GBP/USD, there is a key contracting triangle forming with resistance at 1.3930. The pair has moved above the 38.2% Fib retracement level of the last decline from the 1.4069 high to 1.3716 low.
However, it is facing a major hurdle on the upside near 1.3920-30. The stated zone is also close to the 61.8% Fib retracement level of the last decline from the 1.4069 high to 1.3716 low.
On the downside, the triangle support is at 1.3840. A break below 1.3840 could push the pair back towards 1.3800. On the other hand, a break above the triangle resistance at 1.3930 may perhaps call for a test of 1.4000.
The US Dollar is slightly under pressure this week, but any further gains in EUR/USD and GBP/USD won’t be easy. Today’s US Consumer Price Index released for Feb 2018 could impact the market a lot. Therefore, the next move in the greenback depends on today’s CPI release.
Economic Releases to Watch Today
- US Consumer Price Index Feb 2018 (MoM) – Forecast +0.2%, versus +0.5% previous.
- US Consumer Price Index Feb 2018 (YoY) – Forecast +2.2%, versus +2.1% previous.
- US Consumer Price Index Ex Food & Energy Feb 2018 (YoY) – Forecast +1.8%, versus +1.8% previous.
- UK’s Budget Report.