The British pound continues to weaken against a resurgent U.S. dollar. Market sentiment favors safe haven currencies after U.S. monthly consumer prices surged 6.2 percent. This could complicate matters for the U.S. Federal Reserve as they are considering when to normalize monetary policy.
The benchmark GBP/USD currency exchange rate fell to a new yearly low price point overnight and is entering Thursday’s trade session below the fifty (50) day simple moving average near 1.34. Today’s economic calendar for the United Kingdom is quite heavy with tier one events.
The UK will release quarterly gross domestic product (GDP) numbers as well as monthly industrial production data. RICS will publish their UK monthly housing price balance.
The United States will release their weekly initial and continuing jobless claims. The European Central Bank will publish their forecasts. The Organization for Petroleum Export Countries (OPEC) will release their crude oil report and forecasts.
Daily British Pound Technical Analysis
Looking at the above daily MT4 price chart, the 14 day relative strength (RSI) is looking oversold as the British pound seems to be stalling its decline lower. The GBP/USD Forex market has broken below the September monthly low at 1.3410 and the bears still look to be in control.
Should the British pound stay above 1.34 and see a daily close back above September monthly low price point, the fifty (50) percent Fibonacci level near 1.3460 would come into focus.
The next layer of technical resistance lines up at the July monthly low price level at 1.3575. Above that level, the 50 day simple moving average currently near 1.3678 comes into play.
On the downside, if the GBP/USD currency exchange rate breaks below 1.34, on a daily close, the next downside comes into focus at the 61.8 percent Fibonacci level around 1.3270. Below that is the December 2020 low. This layer of technical support lines up at 1.3130.