Britain’s trade deficit leaped to almost 10 billion and weighed on the pound. On the other hand, manufacturing was OK, at least during September. Conditions are expected to worsen later on.

In the US, Building Permit, main measurement to value the ת Annualized number of new residential construction permits that were issued on the previous month, 0.61M is predicted, similar to 0.62M on the last month,

Riots in various British cities weighed on the pound. At this stage, the riots seem to have a criminal nature rather than expressing discontent. The government isn’t expected to change its policy. Not yet.

GBP/USD managed to break higher on a surprisingly hawkish inflation report early in the week, but manufacturing production sent sterling back to reality, and eventually outweighed the early optimism. Will the upcoming indicators send the pound lower?

It didn’t happen in the past week. Yet again, the interest rate was left unchanged, in a rate decision that was closely watched for a changed. Central bankers will continue rocking the pound in the upcoming week, as many speeches are scheduled.

In the US, Producer Price Index (PPI), price of finished goods and services sold by producers is about to rise by 0.3% and the Core PPI (excluding food and energy) is about to rise by 0.1%. Leading indicator of consumer inflation.

A very busy week expects pound traders – inflation and employment figures are the highlights. Here’s an outlook for the British events, and an updated technical analysis for GBP/USD.

GBP/USD daily chart with support and resistance lines marked. Click to enlarge:

One aspect of recent week’s trading is the dollar’s safe haven status. The yen also enjoys this status, but it wasn’t always this way. Here’s a side story of how the yen took this role from the Swissy. OK, let’s begin reviewing the events:

GBP/USD graph with support and resistance lines on it. Click to enlarge:

GBP/USD  graph with resistance and support lines marked. Click to enlarge: