Analytical review of the currency pair GBP/USD on 23.03.2016
Analytical review:
Since the beginning of March the Pound has significantly grown versus the USD (over 300 points). During yesterday’s trading session the GBP fell by 1.00%.
Yesterday the Pound dropped due to the news about terrorist attacks in Brussels when at least 30 people were killed. Since the opening European session the Pound fell by over 100 points against the USD.
According to the Office of National Statistics, consumer price index in the UK rose by 0.3% in February. Analysts expected the rise of 0.4%. Consumer prices rose by 0.2%, which was below the forecast of 0.4%.
“Commitments of Traders” demonstrated ambiguous picture. Large speculators have reduced the number of long positions by 59610 contracts. The number of short positions have dropped by 25069 contracts.
The volume of retail sales in the UK will become known on Thursday and the data on the US GDP will be released on Friday. This news can have impact on the dynamics and volatility in the market.
Summary:
Yesterday’s terrorist attacks in Brussels, poor British economic data and ambiguous situation in the global economy increases expectations of Brexit.
According to “COT” large speculators do not have common opinion about the GBP.
Movement in the market is mixed at the moment. Economic data on the British and American economics can have strong impact on the currency this week. We recommend to enter the market from the key support and resistance levels.
Trading tips for the currency pair GBP/USD
Long-term trading: The currency is traded in the range of 1.4075-1.4430. We recommend to enter the market after breaking out and testing of these levels. Positions can be opened at the signal line and the nearest support/resistance levels. Risk per trade is not more than 2% of the capital. Stop order can be placed slightly above/below the signal line. Take profit can be placed in parts of 50%, 30% and 20% with the use of trailing stop.
