GBP/USD tests key resistance after UK GDP release

Global stocks bounced back today as investors reflected on the European Central Bank (ECB) decision. In Europe, the DAX, FTSE 100, and CAC 40 indices rose by more than 0.30%. At the same time, futures tied to US indices like Nasdaq 100, Dow Jones, and S&P 500 also rose by more than 0.40%. These gains helped to offset most of the losses that happened this week. In its decision this week, the ECB decided to slow down the pace of asset purchases as the region rebounded. But in a statement, Christine Lagarde said that the bank was not tapering its purchases and was not considering hiking interest rates any time soon. Investors also cheered an upcoming meeting between Xi Jinping and Joe Biden as the two countries attempt to mend the relationship.

The British pound held steady even after the relatively mixed economic numbers from the United Kingdom. The data revealed that the country’s economy rose by 0.1% in July after rising by 5.7% in the previous month. This growth, in turn, led to an annualized growth of 7.5%. By sectors, the country’s construction output declined by 1.6% in July while the industrial and manufacturing production rose by 3.8% and 6%, respectively. These numbers show that the UK economy started to flatten because of the Delta variant. This is in line with what Andrew Bailey predicted in his testimony in parliament.

The price of crude oil held steady even as China took measures to lower oil prices. In an unprecedented move, the country said that it would sell some of oil in its reserves in a bid to lower prices. The decision happened after OPEC+ members decided to gradually increase production this month. This strategy was seen as being relatively bullish for oil prices. The decision by the National Food and Strategic Reserves Administration came at a time when the country is seeing a sharp increase in commodity prices. For example, coal prices have jumped while natural gas has risen to a seven-year high.

EUR/USD

The EURUSD held steady on Friday as investors remained optimistic about the ECB decision. On the three-hour chart, the price is inside the Ichimoku cloud. It remains slightly above the 25-day and 15-day moving averages (MA). The price has also moved slightly above the 25-day and 50-day moving averages while the DeMarker indicator has moved slightly above the oversold level. Therefore, the pair may keep rising as bulls target the key resistance level at 1.1892.

GBP/USD

The GBPUSD pair maintained the bullish trend after the latest UK economic numbers. The pair rose to 1.3885, which was the highest level since September 6. On the hourly chart, the pair is close to the important resistance level at 1.3890. It remains slightly above the short and longer moving averages while the MACD is above the neutral line. The Relative Strength Index (RSI) rose above the overbought level. Therefore, a bullish breakout will be confirmed if the price moves above this resistance level.

ETH/USD

The ETHUSD moved sideways as investors reflected on this week’s sell-off. The coin is trading at 3,403, which is lower than this week’s high of more than 4,000. On the four-hour chart, the pair remains below the 15-day and 25-day moving averages while the MACD has moved below the neutral level. The pair also seems to be forming a bearish pennant pattern. Therefore, it will likely break out lower in the near term.