GBP/USD Forecast: Bears eyeing a break of 1.2170
|GBP/USD Current price: 1.2222
- UK economic growth contracted by 2.0% in the three months to March.
- Industrial production and manufacturing production fell by less than anticipated in March.
- GBP/USD is nearing the 38.2% retracement of its latest daily run at around 1.2175.
The GBP/USD pair surged intraday to 1.2339 but ended up collapsing to 1.2209 afresh monthly low. The UK macroeconomic figures came in mixed, as Manufacturing Production plunged by 4.6% in March, while Industrial Production declined by 4.2%, both better than anticipated, although still indicating a steep contraction. Same happened with economic growth, as the UK economy contracted 2.0% in the three months to March, better than the -2.5% expected. The Goods Trade Balance, in the meantime, posted a deficit £ 12.508 B in March, much worse than anticipated. The later decline of the pair was the result of the resurgent dollar’s demand. The UK won’t release macroeconomic data this Thursday.
GBP/USD short-term technical outlook
The GBP/USD pair has closed in the red for a third consecutive day, a handful of pips above the mentioned low. The pair has turned bearish short-term, as the 4-hour chart shows that it plunged well below a bearish 20 SMA, after a failed attempt to advance above it. Furthermore, the 100 SMA is below the 200 SMA, both above the shorter one. Technical indicators, in the meantime, have bounced modestly from near oversold levels, but remain within negative levels. The main support is now the 1.2170 price zone, where the pair has the 38.2% retracement of its latest daily advance.
Support levels: 1.2200 1.2170 1.2130
Resistance levels: 1.2265 1.2310 1.2355
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