GBP/USD
The last 24 hours has seen the GBP/USD drop sharply back through the key 1.68 level after again moving close to the resistance level around 1.6850. Prior to that the last few days saw the pound slowly edge back towards the key 1.68 level after moving to a multi-year high near 1.6850 within the last week. The last month has seen a steady climb higher from a one month low below 1.65. About a month ago the resistance level at 1.6750 became important as the pound was struggling to make any break above it. This level eventually led the pound to fall to its one month low before the recent resurgence. The 1.6650 level also became important as it provided reasonable support during that period. Throughout the last couple of months the GBP/USD has received solid support from the key 1.66 level after it retraced strongly from the resistance level at 1.68.
In early February, the pound enjoyed a very healthy time moving well from the support level at 1.6250 through 1.6450 before pushing on to the then multi-year high above 1.680. In late January the pound fell sharply and experienced its worst one week fall this year which resulted in it moving to the six week low near the support level at 1.6250. Over the last few months the pound has established and traded within a trading range roughly around the key level of 1.6450, whilst moving down to support at 1.6250 and up to 1.66 and beyond.
The 1.66 level has become quite significant and has loomed large throughout this year providing some resistance to higher prices. This level has resurfaced again as one of significance and it is now providing solid support. In late November it did well to break through the long term resistance level at 1.6250 which had established itself as a level of significance over the last few months. This level continues to play a role in providing support. In early November, the pound bounced strongly off the support level at 1.59 to return back to above 1.6250.
Optimism among U.K. manufacturers rose at its fastest rate since 1973 in the first three months of this year, according to a survey out on Wednesday. The quarterly survey of 405 manufacturers by the CBI (a U.K. business lobbying group) found that over two-fifths of businesses were more optimistic about the business situation than three months ago. Only 8 percent were less optimistic. "There are still bumps in the road ahead, with only a tepid recovery likely in the euro zone, the pound creeping higher and a rapidly evolving situation in Ukraine. However, expectations for growth in the coming three months are positive and manufacturers plan to significantly ramp up investment in the year ahead," said Katja Hall, CBI chief policy director, in a news release. The survey was conducted between March 24 and April 9, during which time the pound averaged 1.21 euros and $1.66. Around one-third of interviewees reported an increase in total orders and the same number posted a rise in output volumes. Firms were also upbeat about the next quarter, with growth expectations for domestic orders and output at the highest since the 1970s.
GBP/USD April 24 at 02:10 GMT 1.6786 H: 1.6834 L: 1.6762
GBP/USD Technical
| S3 | S2 | S1 | R1 | R2 | R3 |
| 1.6600 | 1.6300 | 1.6250 | 1.6850 | --- | --- |
During the early hours of the Asian trading session on Thursday, the GBP/USD is trying to rally higher and get back within touch of the 1.68 level after dropping heavily back down through it over the last day or so. Current range: Trading just below 1.6800 around 1.6790.
Further levels in both directions:
• Below: 1.6600, 1.6300, and 1.6250
• Above: 1.6850.
OANDA's Open Position Ratios
(Shows the ratio of long vs. short positions held for the GBP/USD among all OANDA clients. The left percentage (blue) shows long positions; the right percentage (orange) shows short positions.)
The GBP/USD long positions ratio has moved back below 30% again as the GBP/USD remains steady around 1.6800. Trader sentiment remains in favour of short positions.
Economic Releases
- 10:00 UK CBI Distributive Trades (Apr)
- 12:30 US Durable goods orders (Mar)
- 12:30 US Durables ex defence (Mar)
- 12:30 US Durables ex transport (Mar)
- 12:30 US Initial Claims (18/04/2014)