The pound’s hopes were short lived in a very choppy week. The upcoming one promises to be very busy, with employment, inflation and the meeting minutes being the highlights. Here’s an outlook for the 9 events that will rock the pound, and an updated technical analysis for GBP/USD. 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? GBP/USD daily chart with support and resistance lines marked. Click to enlarge: Rightmove HPI: Sunday, 23:00. This house price report isn’t the most accurate one available out there, but it’s published very fast and very early in the week. A strong rise of prices was seen last move according to Rightmove – 1.7%. Prices are likely to rise once again, but this rise is likely to be marginal this time. Inflation data: Tuesday, 8:30. Inflation is above target for a very long time, but last month was refreshing – the annual pace significantly dropped to 4%, easing pressures for a rate hike. This time, headline CPI (Consumer Price Index) is expected to tick up to a pace of 4.1%. A fall under the round number of 4% will hurt the pound. Core CPI is at 3.2%, also too high, and is likely to rise to 3.4%. RPI (Retail Price Index) is sometimes considered a better gauge of what consumers feel, is expected to remain at 5.3%. Inflation letter: Tuesday, after 8:30. The high level of inflation means that the governor of the BOE, Mervyn King, needs to write a public letter to the Chancellor of the Exchequer, George Osborne, and explain why inflation is high and what the central bank plans to do about it. In past letter, King usually blamed inflation on oil prices and hinted that no hikes were in the horizon. Given last week’s bullish inflation report, that upgraded expectations, this time might be different. In any case, this letter will rock the pound. Adam Posen talks: Tuesday, 10:00. Posen is the only member of the BoE that wants an expansion of the quantitative easing program. This extreme dove will speak in a conference in London. If he makes a more hawkish statement, this can boost the pound. Nationwide Consumer Confidence: Tuesday, 23:00. Delayed from last week. This survey of 1000 consumers is considered to be a good barometer of British consumers’ moods. It recovered last time to 44 points, after a few months of falls. It’s now expected to continue improving, up to 49 points. Employment data: Wednesday, 8:30. Last month saw a disappointing rise in the number of people claiming for unemployment benefits. This weighed on the pound. Yet another rise, of 1300 people (more than 700 last month) is expected in the Claimant Count Change for April. The unemployment rate for March is expected to tick up from 7.8% to 7.9%. A rise back to 8% will be quite worrying. MPC Meeting Minutes: Wednesday, 8:30. Although published at the same time as the employment figures, we’ve seen last month that the meeting minutes were of very high importance – they clearly showed that the rate hike will be pushed further back. Will they hurt the pound again? In the past few months, 3 out of 9 members voted for a rate hike. But the previous meeting minutes have shown that two out of three of these members are more reluctant now. If the score board grows in favor of the doves, the pound will fall, regardless of the job figures. Retail Sales: Thursday, 8:30. British consumers were more active than expected in March – instead of squeezing their expenses, they spent more, and the volume of sales rose by 0.2%. Another rise is expected in April ,and even a stronger one – 1.1%. CBI Industrial Order Expectations: Thursday, 10:00. This gauge of economic activity was quite weak last month, falling back into negative territory, a bad sign for the manufacturing sector. It’s now predicted to tick up from -11 to -5. Yes, still in negative territory. GBP/USD Technical Analysis A sharp upside down V can be seen on the graph, and this shows the short lived breach of the 1.6430 line (discussed last week). The pound eventually retreated and closes on lower ground. Technical levels, from top to bottom: Now further away, the 2009 peak of 1.7042 is important resistance in the distance. It was the highest level since the financial crisis. Minor resistance is found at 1.6843, which was a line of resistance in the past. 1.67 remains strong resistance, despite temporary breaches in recent weeks. These were false breaks. 1.66 is even stronger, being very distinct – separating between low and high ranges just now, and having a role in the past as well. 1.6530 capped recovery attempts just now and also in recent weeks, and will have a similar role on rises now. A more pivotal line is 1.6430, which worked in both directions in recent months and was breached for quite a short time now. Pivotal areas: the veteran 1.6280 to 1.63 is quite close, and will likely cushion falls. It was a peak several times in recent months. Further below, 1.6110 is another veteran line, which had a chance to work as support recently. It will be tested on a downfall. The round number of 1.60, which was a peak in August 2010 and resistance afterwards, is only minor support now. More significant support is at 1.5940, which was tested more than once. The next levels below are 1.5820 which was a trough before the current wide range trading and 1.5750 will be the final line for now. I remain bearish on GBP/USD. The British economy isn’t doing well. There was lots of evidence in recent weeks, with manufacturing production providing more reasons for worries. Falls could accelerate on dovish MPC minutes, a fall of inflation under 4% or another rise in unemployment. Further reading: For a broad view of all the week’s major events worldwide, read the USD outlook. For EUR/USD, check out the Euro/Dollar forecast. For the Japanese yen, read the USD/JPY forecast. For the Australian dollar (Aussie), check out the AUD to USD forecast. For the New Zealand dollar (kiwi), read the NZD forecast. For USD/CAD (loonie), check out the Canadian dollar For the Swiss Franc, see the USD/CHF forecast. Yohay Elam Yohay Elam Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts. Yohay's Google Profile View All Post By Yohay Elam Expert score 5 Etoro - Best For Beginner & Experts0% Commission and No stamp DutyRegulated by US,UK & International StockCopy Successfull Traders 5 Read Review Open My Free Account Your capital is at risk. GBP USD ForecastMajors share Read Next GBPJPY: Vulnerable To The Downside Into The New Week. Yohay Elam 10 years The pound's hopes were short lived in a very choppy week. The upcoming one promises to be very busy, with employment, inflation and the meeting minutes being the highlights. Here's an outlook for the 9 events that will rock the pound, and an updated technical analysis for GBP/USD. 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? GBP/USD daily chart with support and resistance lines marked. 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