Review and forecast
Today at 11:30 (GMT+3) British GDP for Q3 became known. The index has exceeded expectations. After the Brexit referendum on June 23, the British economy has been growing faster than expected. GDP has grown by 0.5% against the forecast of +0.3% and Q2 and by 2.3% (forecast +2.1%) against the same period last year.
British National Bureau of Statistics reported that 0.2% of GDP growth was made by the sector "Transport, storage and communication", which includes the sale of cinema tickets. This sector has been growing at the highest rate since Q4 2009.
The pair GBP/USD has rapidly grown by 65 points on this news. However, later the pair GBP/USD began to fall from the level of 1.2270, which is the intraday highs and an hour were later it was traded near the level of 1.2230.
The Pound gave example to the other currencies, which have also grown against the USD.
However, the USD quickly regained losses especially in the positions against the yen and commodity currencies.
After strong decline since the beginning of this month the pair GBP/USD pair is traded in a narrow range of 1.2340 and 1.2120 in the past two weeks.
On 4- hour and daily charts the indicators OsMA and Stochastic do not give clear signals. On the monthly and weekly charts the indicators give signals to sell.
On the weekly chart the pair GBP/USD is in the descending channel with the lower limit below the level of 1.1800.
On the daily chart the pair is in the descending channel, its lower limit is crossing the level of 1.1750. It is likely that the levels of 1.2000, 1.1850, 1.8000 and 1.1750 will be the new targets case of the further decline in the pair GBP/USD.
Since the beginning of September the pair GBP/USD has broken all support levels due to pressure of the strong bearish momentum. The decline is likely to continue.
The pair may undergo short-term corrections to the levels of 1.2270 (today's high), 1.2340 (upper limit of the current range), 1.2395 and 1.2570 (ЕМА200 on 4-hour chart and the upper limit of the descending channel on the daily chart).
It is advisable to open only short positions on the pair GBP/USD. Short-term long positions can be opened only at the time of correction.
Support levels: 1.2120, 1.2000, 1.1850 and 1.1800.
Resistance levels: 1.2270, 1.2340, 1.2395, 1.2465, 1.2615, 1.2715, 1.2795, 1.2875 and 1.2900.
Sell in the market. Stop-Loss: 1.2285. Take-Profit: 1.2200, 1.2100, 1.2000 and 1.1850.
Buy Stop: 1.2285. Stop-Loss: 1.2235. Take-Profit: 1.2340, 1.2395, 1.2465, 1.2615, 1.2715, 1.2795, 1.2875 and 1.2900.
In the descending channel
Indicators give sell signals