GBP/USD: Attempt To Gain Strength And Consolidate Above 1.5400
LiteForex Europe | Mar 04, 2015 07:00AM ET
The GBP/USD tried to regain strength and consolidate above 1.5400 during yesterday's trading session. The cable reached a level of 1.5403 before noon but failed to hold its positions. Market participants ignored positive data published by the research group Markit and Chartered Institute of Purchasing and Supply. The business activity index in the construction sector grew month-on-month against the previous value and amounted to 60.1, which is more than the forecast of 59.0.
This week there will be the Bank of England's meeting where the question of the interest rate rise will be discussed. Investors are not expecting any surprises; therefore it's highly likely that the meeting will not influence the GBP/USD rate.
The publication of consumer inflation expectations seems to be a more important event of this week as the bane of the UK monetary authorities is reaching the key level of 2% while the forecast for 2015 is only 0.9%. Low prices of energy resources made inflation drop to the level last recorded in 2000. Last year the Bank of England announced its willingness to raise interest rates, but the current market situation involves a bigger decline, which will undoubtedly weaken the pound.
Resistance levels: 1.5403 (yesterday's maximum), 1.5461 (27th February's maximum), 1.5552 (26th February's maximum), 1.5620 (31st December maximum) 1.5700 (important psychological level).
Support levels: 1.5400 (important psychological level), 1.5335 (38,2% Fibonacci retracement), 1.5270 (50% Fibonacci retracement), 1.5200 (61,8% Fibonacci retracement, lower line of Bollinger bands), 1.5100 (important psychological level), 1.4985 (3rd of February's minimum).
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