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GBP/USD had a largely uneventful week and closed almost unchanged. The pair closed the week at 1.5670. This week’s highlight is Second Estimate GDP. Here is an outlook on the major events moving the pound and an updated technical analysis for GBP/USD.

The Fed minutes brought more uncertainty to the timing of a rate hike, as the Fed is clearly hesitant about raising rates in September. US employment numbers were steady and housing numbers beat expectations. In the UK, Retail Sales fell short of expectations.

[do action=”autoupdate” tag=”GBPUSDUpdate”/]

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

 

GBP_USD_Forecast.Aug24-28

  1. BBA Mortgage Approvals:  Wednesday, 8:30. This  indicator provides a snapshot of the UK housing sector. The June  reading  improved to  44.5 thousand, beating expectations.
  2. CBI Realized Sales:  Tuesday, 10:00. The indicator has slipped badly since hitting 51 points earlier in the year. The indicator fell to 21 points in July, and little change is expected in the upcoming release.
  3. Nationwide HPI:  Thursday, 6:00. The housing inflation indicator bounced back with a gain of 0.4% in July, matching the forecast. Another gain of 0.4% is expected in August.
  4. GfK Consumer Confidence:  Thursday, 23:05. The indicator slipped to 4 points in July, and an identical reading is expected in the August release.
  5. Second Estimate GDP:  Friday, 8:30.  GDP is one of the most important indicators and should be treated as a market-mover by traders. Preliminary GDP came in at 0.7 for Q2,%, matching the forecast. The forecast for Second Estimate GDP also stands at 0.7% for Q2.
  6. Preliminary Business Investment : Thursday, 10:00. This indicator is released each quarter, magnifying the impact of each reading. The indicator broke a string of 2 declines in Q1, posting a strong gain of 1.7%. This easily beat the forecast of 1.2%. Little change is expected in the Q2 report.
  7. Index of Services: Friday, 8:30. The indicator has been steady, and came in at 0.4% in May, which was within expectations.
  8. BOE Governor Mark Carney Speaks:  Saturday, 2:25. Carney will speak at the Federal Reserve symposium in Jackson Hole. A speech that is more hawkish than expected is bullish for the pound.

* All times are GMT

GBP/USD Technical Analysis

GBP/USD opened the week at 1.5647 and  quickly touched a  high of 1.5723,testing resistance at 1.5682 (discussed last week). The pair then reversed directions,  and dropped to a low  of 1.5562.  The pair recovered and closed the week at 1.5670.

Live chart of GBP/USD: [do action=”tradingviews” pair=”GBPUSD” interval=”60″/]

Technical lines from top to bottom

We  begin with resistance at 1.6133, which was an important support level in the first half of 2014.

1.6006 is protecting the symbolic 1.60 level.

1.5909 has  held firm as resistance since June.

1.5769 is the next resistance line.

1.5682 was tested as  the pair showed some  strength.  It was an  important cap in December 2014 and January 2015.

1.5590 continues to be busy in August.  It is an immediate support level.

1.5485 is the next support level.

1.5341  has  held firm in support since mid-June.

1.5269 was an important support level in March.

1.5163 is the final support line for now.

 

I am  neutral on GBP/USD.

The pair has alternated between weekly gains and losses over the past two months. With uncertainty continuing over the Fed rate hike continuing, we could see the pair in a holding pattern.

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