GBPUSD Eyes BOE For A Break09 April, 2015 by Aayush Jindal in Fundamental Analysis, GBPUSD, Market Analysis, Technical Analysis
- British pound climbed higher recently against the US dollar, but failed around an important resistance area.
- In the UK, the BOE Interest Rate Decision will be announced by the Bank of England, which might cause heavy movements in GBPUSD.
- GBPUSD is forming a breakout pattern with support at 1.4850 and resistance ahead at 1.4950.
The British pound managed to surge higher yesterday against the US dollar and was one of the best performers. However, the GBPUSD pair failed to maintain the momentum and traded lower. It found resistance around an important area at 1.4980-1.50.
There is a contracting triangle pattern formed on the 4-hour chart of the GBPUSD pair, which is acting as a catalyst. The recent failure was also around the triangle resistance, and currently the pair is heading towards the support area. Moreover, the pair is finding bids around the 100 simple moving average (SMA).
On the upside, the triangle resistance is also coinciding with the 61.8% fib retracement level of the last leg from the 1.5164 high to 1.4680. In short, there is a great chance of the pair moving lower in the near term.
UK Trade Balance
Today, during the London session, there are a couple of high-risk events lined up in the UK, including the trade balance report and the BOE interest rate decision. The UK trade balance report representing the balance between exports and imports of goods will be released by the National Statistics. The last reading was a deficit of £-0.616B. Let us see how it unfolds this time. Furthermore, the BOE Interest Rate Decision will be announced by the Bank of England.
Australian AIG Performance Index
Earlier today, the HIA/AiG Performance of Construction Index was released by the Australian Industry Group and the Housing Industry Association, which measures the conditions on the short and medium term in the construction market. The outcome was on the higher side, as the HIA/AiG Performance of Construction Index climbed from the last reading of 43.9 to 50.1 in March 2015.
The report stated that there was sharp improvement in the new orders sub-index, which in turn helped the expansion in the HIA/AiG Performance of Construction to post a reading above 50 points for the first time in the five months, as per the official release.