GBP/USD moved upwards during the week, but gave up almost all of those gains, closing at 1.5615. The upcoming week is a quiet one, with just four releases. Here is an outlook for the upcoming events, and an updated technical analysis for GBP/USD.
After showing some strength during the week, the pound was hobbled by some disappointing data at the end of the week, including very poor Retail Sales and a Public Sector Net Borrowing release which posted a wider deficit than expected.
GBP/USD graph with support and resistance lines on it. Click to enlarge:
*All times are GMT
GBP/USD Technical Analysis
GBP/USD opened the week at 1.5580. After dropping to a low of 1.5517, GBP/USD rose to a high of 1.5737, as the resistance line of 1.5750 (discussed last week) held firm. The pair then retraced, closing the week almost unchanged at 1.5615.
Technical levels from top to bottom
We start with resistance at 1.6060. Below, is the line of 1.5992, protecting the important 1.60 level. This is followed by resistance at 1.5930. The next resistance line is just above the 1.58 line, at 1.5805. This line was last breached in late May, as the pound went on a sharp slide.
Close by is 1.5750, which held firm as the pound made a brief push upwards early in the week. Next, 1.5648 which has been alternating between support and resistance roles, is currently providing resistance following the strong surge by the dollar.
This is followed by the round figure of 1.5600, which is providing the pair with weak support. It looks to be tested if the pound shows some weakness. Next, there is support at 1.5521. This line was briefly breached by GBP/USD as the pair fell before retracing. Below, the pair is receiving support at 1.5415. This is followed by support at 1.5361, a line which has held firm since early June. Close by, there is strong support at 1.5309. This line has not been breached since September 2010.
The next support level is at 1.5229. This is followed by 1.5124, which has not been tested since July 2010. Below, there is support at 1.5054, which was last breached in June 2010. The final support level for now is 1.4891.
I am bullish on GBP/USD.
GBP/USD has shown some strength, recently, not including a drop at the end of last week following some poor UK data. The markets are very concerned over a host of poor US releases, and the pound could benefit if the US economy continues to struggle. If UK data does not continue to disappoint, the pound could move upwards against the dollar.