At the end of last week the pair GBP/USD met expectations of decline reaching the level of 1.6415. On one hand, the decline was caused by favourable macro-economic statistics from the USA, on the other hand, by the decrease in demand for the British currency. American indices of personal expenses, purchasing managers and labour costs have been above the forecast.
Today’s attention shall be focused on manufacturing activity index PMI in Great Britain. In addition, the US data on construction expenses and business activity in manufacturing sector will become known. According to forecast British PMI will decline, causing weakening in the Pound. Forecast for American news is positive. In the medium-term the pair will continue decline to support level of 1.6320, after which the pair may experience slight upward correction and then will continue to move in the downtrend.
Support and resistance
Support levels: 1.6320, 1.6200, 1.6100 and 1.5920.
Resistance levels: 1.6450, 1.6540, 1.6600 and 1.6660.
It is advisable to place sell orders with profit taking at the level of 1.6100.
Analyst of LiteForex Group of Companies