The British pound made some nice headway against the U.S. dollar last week. However, the GBP/USD currency exchange rate was unable to conquer the 61.8 percent Fibonacci level from 1 June to 20 July recovery. The GBP/USD Forex market closed the week and month around the fifty percent Fibonacci level at 1.3918/17.
This key benchmark currency exchange rate seems poised for more gains on Monday. The United Kingdom will publish final monthly purchasing mangers’ indices (PMI). The United States will also release the monthly Markit manufacturing purchasing mangers’ index. The Institute for Supply Management (ISM) will publish their monthly manufacturing purchasing mangers’ index for the U.S.
The euro area is publishing monthly manufacturing purchasing mangers’ index numbers as is their largest economy, Germany. Germany will also publish monthly retail sales data.
Daily British Pound Technical Analysis (GBP/USD)
Looking at the above daily GBP/USD price action chart, the 14 day MACD momentum indicator is looking strong. The British pound simply saw some profit taking after the sharp gains against the U.S. dollar.
This week could see further gains for the sentiment linked British pound while above the short term rising trend line. With that said, the GBP/USD currency exchange rate is trading between 1.4050 and 1.3980. A daily close above 1.40 could bring the bulls into this Forex market.
There is immediate technical resistance lining up at the one hundred (100) day simple moving average. This level lines up at 1.3920. The next upside level is at the fifty percent Fibonacci level at 1.3918/17. The fifty day simple moving average comes into play at 1.3947. The next layer of technical resistance lines up at 1.3950.
On the downside, the GBP/USD currency exchange rate has immediate technical support at 1.39. A daily close below 1.39 opens the door for the technical support at 1.3830 with 1.38 then coming into the picture. A sustained close below the round 1.38 level opens the door to challenge the technical support which lines up at 1.3770.