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British Pound Remains below the 100 Day SMA

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The British pound is trading between 1.3865 and 1.3850 against the U.S. dollar during the Asian trade session on Thursday. On Wednesday, the headline GBP/USD currency exchange rate broke a two day losing streak but remains below the one hundred (100) day simple moving average and above the two hundred (200) day simple moving average.

On the economic calendar for today, British pound and U.S. dollar traders will be looking at labor data. The United Kingdom is publishing their monthly unemployment rate, monthly claimant count and 3M/3M average hourly earnings. The UK will also publish the monthly leading index from the Consumer Board (CB).

The United States will see weekly initial and continuing jobless claims from the Labor Department. The Philadelphia Fed will publish their manufacturing index for June and the U.S. will release monthly industrial production data. The euro area has a quiet economic calendar.

Daily British Pound Technical Analysis                                

Looking at the daily price action chart, above, the GBP/USD Forex market is trading above a three month old rising trend line and the 200 day simple moving average. This is an encouraging sign for British pound bulls.

However, a daily close above the 100 day simple moving average near 1.3890 is needed for the GBP/USD currency exchange rate to mount a meaningful recovery. The next upside barrier lines up at the monthly high price point. This resistance level is at 1.3910. The next upside barrier is a congestion zone at 1.40 to 1.410. There is another layer of technical resistance in play at 1.4075.

On the downside, there is immediate technical support at 1.38. The rising trend line from 9 April then comes into play. This downside barrier is at 1.3740. A daily close below this level brings the 200 day simple moving average at 1.3690 into focus then the February low price point at 1.3565 comes into the picture.

About David Frank

David has his MA and PhD in Economics. He is a technical analyst who has been trading in the Forex world for over a decade. As an analyst and trader, David believes in the big picture by blending together technical analysis with the fundamentals behind the scenes in the Forex and Bond markets. David’s trading strategy is unique. He blends an understanding of fundamental and macroeconomics with technical analysis to offer a unique view into Forex. He applies several strategies including carry long positions, to take advantage of high yields in non-volatile markets, as well as using quicker, chart related analysis for day trading.

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