The binary GBP/USD posted very decent gains for the period after July 12th. The improved investors’ sentiment sent the pound off of the lows it touched on Thursday at levels of 1.5422. The British currency was even able to post fresh new highs against its American counterpart for the period after July 3rd.
The binary GBP/USD moved above its 25-period, its 50-period and its 200-period moving averages to trade as high as 1.5677 at one point during today’s session. The pound lost its upward momentum and moved into negative territory on released bad economic data for the British economy at around 08:30 GMT .
Figures for the CPI came in at 2.4%, lower than the 2.8% analysts have been expecting. At the same time, the RPI on a year-over-year basis was 2.8%, being again lower than the reading of 3.0%, which most economists projected.
The only ray of hope came from the HPI data, which showed that the prices of homes in Great Britain increased by 2.3%. Economists were expecting a modest 1.3% increase. After the news were announced the pound lost ground and even traded below its 200-period moving average for a while, but then it managed to pare some of its losses and it is currently standing at 1.5616.
Technically speaking, resistance in the binary GBP/USD is provided by the highs we reached in the beginning of the month – around 1.5700. Support, on the other hand, stays at the 200-period moving average – around 1.5566. Oscillators are all close to the upper band of their respective ranges with the relative strength index at 59 and the stochastic around 68. The MACD is trending higher and is currently very close to the highs it reached in the beginning of July.
The daily chart shows that the binary GBP/USD is in a double bottom formation with the first low reached around the beginning of June and the second one– on Thursday. If the binary currency pair manage to break sustainably above 1.5750, where both the intermediate highs of the second half of June and the 200-day moving average stands, traders may see a strong push to the upside, which could take the pair as high as 1.6300. Before any considerations for a trend reversal, the pound should overcome the resistance at its 50-day moving average, which is standing at 1.5643.
The oscillators on the daily chart are in mid-range with the relative strength index at 52 and the stochastic at 66. The MACD, on the other hand, is moving in tight range, just a whisker below the key 0 level.
The information in this analysis is collected from different sources and should serve for informative purposes only. The author shall not be held responsible for the validity of the presented information. No part of this analysis recommends the purchase or sale of a currency pair or any other financial instrument.