GBP/USD Forecast: downside limited, bullish above 1.2625
|The GBP/USD pair recovered some ground after bottoming Thursday at 1.2548, trading up to 1.2608 ahead of the release of the UK trade balance figures. The UK’s deficit on trade in goods was £9.7 billion in October 2016, narrowing by £4.1 billion from September 2016. The report also showed that exports increased by £2.0 billion and imports decreased by £1.8 billion.
Overall positive, the report supported the Sterling which added a few pips to its daily advance against the greenback, holding near its daily highs. In the 4 hours chart, technical readings present a limited upward potential, as indicators are recovering within bearish territory, while a bearish 20 SMA heads south above the current price.
The immediate resistance comes at 1.2625 the 38.2% retracement of the latest bullish run, and the level to surpass to confirm an upward extension towards the 1.2660 region, en route to 1.2700. Below 1.2575 on the other hand, the risk turns towards the downside, with scope then to extend the side down to the 1.2500 region.
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