GBP/USD: Trading Between Levels Of 1.5900 And 1.5180
LiteForex Europe | Sep 21, 2015 08:59AM ET
On Tuesday, Public Sector Net Borrowing statistics are released in the UK. According to the forecast, a budget deficit accounts for 9 billion pounds against a 1.3 billion surplus in July. Thus, in August, there was a decline in revenue. If the expectations pan out, the GBP/USD pair is likely to be under pressure. The pair has been trading between the levels of 1.5900 (50.0% Fibonacci correction) and 1.5180, near 1.5230 (23.6% Fibonacci). A narrower price range lies between the levels of 1.5600 (38.2% Fibonacci) and 1.5490 (ЕМА144 on the daily chart). If the Bank of England cuts interest rates in October, the pair may break down the range and decline to recent year lows at 1.4600.
According to OsMA and Stochastic on the 4-hour chart, short positions are preferable. On the daily chart, the indicators are giving no clear signals; however, Stochastic is starting turning to sales, and OsMA histogram is not growing. The breakdown of the level of 1.5475 (ЕМА200 on the 4-hour chart) would confirm a downward trend, while the breakout of 1.5600 (Fibonacci 38.2% and the upper border of the downward channel) and consolidation above 1.5700 would allow the pair to grow to 1.5900 (Fibonacci 50.0%).
Support levels: 1.5530, 1.5490, 1.5475, 1.5350.
Resistance levels: 1.5600, 1.5650, 1.5675.
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