On Tuesday, quotes in the pair GBP/USD rose again after minor correction on Monday. The USD was under pressure from ZEW business activity index in Eurozone, which was above expectations. In April, this index amounted to 64.8 points.
Today, the price will continue to rise up to 1.5050, despite the release of the minutes of the last meeting of the Bank of England, which was not favourable for the GBP. Bank officials believe that British economy will face deflation in the nearest months and inflation growth rate will be slow until the end of this year. They are also concerned about low rise in salaries, as although its growth is ahead of inflation, it is yet not sufficient. There will not be any important news today, which can affect movement in the pair. However, on Thursday, attention shall be paid to the British retail sales for March and preliminary business activity index in the manufacturing sector of the USA from Markit.
Support and resistance
The pair has broken down the upper line of Bollinger bands indicator, which can provoke correction to 1.4990 and 1.4945. On the other hand, the bands are diverging, which indicates upward trend.
Other technical indicators show the rise in quotes. MACD histogram is in the positive zone, crossing the signal line from top to bottom. Stochastic lines have crossed and turned upwards.
Support levels: 1.4990, 1.4945 and 1.4855.
Resistance levels: 1.5050, 1.5100 and 1.5160.
In the current situation it makes sense to open long positions after breakdown of the level of 1.5050 with the targets of 1.5100 and 1.5160. If the price consolidates below the level of 1.4990, it is advisable to open short-term short positions with the target of 1.4945
LiteForex Investments Limited AnalyticsPublication source