GBPUSD – Is This A Real Break?

Key Highlights

  • British Pound climbed higher today versus the US Dollar, as buyers managed to gain traction.
  • UK Consumer Price Index released by the National Statistics registered no change in in June 2015, compared to the same month of the previous year just as the market expected.
  • US Retail Sales released by the US Census Bureau posted a decline of 0.3% in June 2015, whereas the expectation was of an increase by 0.3%.

UK CPI

Earlier during the London session, the UK Consumer Price Index, which is a measure of price movements by the comparison between the retail prices of a representative shopping basket of goods and services was released by the National Statistics. The forecast was aligned for a rise of 0.1% in June 2015, compared with the preceding month. The outcome missed the forecast, as the UK CPI came in at 0%.

UK CPI

When we look at the yearly change, the UK CPI was unchanged at 0% which was in line with the market forecast. The report highlighted that the “CPI was unchanged between May and June 2015 compared with a rise of 0.2% between the same 2 months a year earlier. The 1-month movement was therefore 0.2 percentage points lower this year compared with a year ago”.

US Retail Sales

There was a major release in the US as well, as the Retail Sales that measures the total receipts of retail stores. Monthly percent changes reflect the rate of changes of such sales was released by the US Census Bureau. The forecast was of a 0.3% increase in June 2015, compared with the preceding month, but the outcome was way below the expectation. The US Retail Sales declined by 0.3% in June 2015. The US Dollar came under pressure after the release and declined.

GBPUSD Technical Analysis

The British pound blasted higher today against the US dollar to trade above an important bearish trend line on the 4-hours chart. Moreover, the GBPUSD pair settled above the 200 SMA (4H), which is a positive sign.

GBPUSD

However, on the other hand, the pair is struggling around the 100 SMA, and the 50% Fib level of the last drop from 1.5929 high to 1.5330. Overall, it is hard to conclude that the recent break is a real one or not.



Aayush Jindal

Aayush is a Senior Forex, Cryptocurrencies and Financial Market Strategist with a background in IT and financial markets. He specialises in market strategies and technical analysis, and has spent over a decade as a financial markets contributor and observer. He possesses strong technical analytical skills and is well known for his entertaining and informative analysis of the currency, commodities, Bitcoin and Ethereum markets.

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