Looking for the latest outlook, for the current week? Check out the section: GBP/USD Forecast
After a wild week that ended with negative GDP, the Pound shrank with the economy. This week’s Nationwide HPI, CBI Realized Sales and 4 other events will move the Pound. Here’s a review of the upcoming week for the British Pound, and an updated technical analysis for GBP/USD.
GBP/USD forex chart with support and resistance lines marked on it. Click to enlarge
The week began well for the Pound, with hawkish statements from the BoE and high expectations for the end of the recession. The disappointment from the GDP was strongly felt. After being beaten, will the Pound find new fuel? Let’s review the events this week:
- Nationwide HPI: This important house price index isn’t the earliest, but it’s quite precise. House prices have been rising in Britain in the past 5 months, showing that this sector is recovering. After a 0.9% rise last month, it’s expected to rise by 0.7% this time. The exact time of publication isn’t known yet. Check out the daily outlooks for the exact timing.
- BOE Financial Stability Report: The British economy is stable, but not in a good way. Following last week’s depressing GDP figure, the Bank of England is expected to release this report about the stability of the financial system this week. The exact timing is unknown. A good report will help the Pound.
- Adam Posen speaks: Adam Posen is a member of the MPC, responsible for rate decisions. He’s rather dovish, urging the expansion of the QE program, thus weakening the Pound. It will be interesting to watch his words quite early in the week – Monday at 6:35 GMT.
- CBI Realized Sales: The Confederation of British Industry surveys both retailers and wholesalers when composing this important sales indicators. For the first time in 6 months, this figure was positive last time at 3 points, indicating a higher sales volume. The positive trend is expected to continue, with 6 points this time. Published on Tuesday 11:00 GMT.
- Net Lending to Individuals: When consumers are more optimistic and confident, they borrow more and spend more. After dipping August’s release, consumers have increased lending last month, at a net rate of 0.7 billion. This number is expected to repeat itself this time. Published on Thursday at 9:30 GMT.
- GfK Consumer Confidence: This survey of 2000 consumers has shown pessimism in the past three years or so. The trend is positive though, with -16 last time, the highest in 20 months. It’s expected to edge higher this time, and rise to -14. Published on Friday, just after midnight.
GBP/USD Technical Analysis
The Pound continued the comeback at the beginning of the week, stopping to rest at 1.65. It then continued higher, even passing the mighty 1.6660 resistance line just before the GDP release on Friday morning. A sharp fall sent it down to close at 1.6301. Quite a drama.
Support and resistance lines haven’t changed since last week’s GBP/USD outlook. 1.6660 still serves as a strong resistance line, serving as such during the summer and at the height of the crisis last year. Above that, 1.7042 is the peak that GBP/USD reached when it managed to pass 1.6660. It probably won’t be approached soon.
Looking down, 1.6110 served as a resistance line during the latest comeback of the Pound. Below that, 1.5720 is a very strong resistance line.
Check out Mohammed Isah’s technical analysis for GBP/USD.
- For a broad view of all the week’s major event in all currencies, read the forex weekly outlook.
- For the Euro, read the EUR USD Forecast.
- For GBP/USD, look into the British Pound forecast.
- For the Australian dollar, read the AUD/USD forecast.
- For USD/CAD, check out the Canadian dollar forecast.
Want to see what other traders are doing in real accounts? Check out Currensee. It’s free.