GBP/USD Likely Trade Sideways If Price Fails to Close Above Key Resistance Near 1.3320

GBP/USD – Technical Analysis for Forex Trading & CFDs.

United Kingdom – Public Sector Net Borrowing

On Tuesday, at GMT 9:30 a.m., the UK’s Office for National Statistics will release the public sector borrowing figure that measures the difference in value of the spending and income of the public corporations as well as the central government of the UK and other local governments during the last month.

A positive public sector borrowing figure would indicate a budget deficit and a negative figure would indicate a budget surplus. Hence, a negative figure is usually taken as good news by Forex traders for the British Pound.

Last month, the UK public sector borrowing figure came out at 5.3 billion, and the forecast for this month is set at a much higher figure, at 6.6 billion.

United States – Core Durable Goods Orders

On Wednesday, at GMT 1:30 p.m., the US Census Bureau will release the month-over-month core durable goods orders figure, which measures the changes in the total value of all new purchase orders made to the US manufacturers for durable goods over the past month. However, the US Census Bureau excludes goods from the transportation sector in this figure in order to offer an accurate picture.

Forex investors consider the US core durable goods orders to be the primary gauge of production situation in the economy, as an increase in purchase orders indicates that US manufacturing activity and growth will happen in the near future.

Last month, the US core durable goods orders increased by 0.7% and the forecast for this month is currently set at an increase of 0.4%.

GBP/USD Forecast

Since forming a bullish pin bar on June 21, 2017, the GBP/USD remained bullish and formed a well-respected uptrend line. However, after starting a retracement in the middle of September, the pair fell to the support near the 1.3050 level and since then, it remained range bound and traded sideways between the 1.3050 and 1.3320 levels.

As the UK’s Public Sector Net Borrowing is expected to increase to 6.6 billion, but the US Core Durable Goods Orders figure is expected to increase by an additional 0.4%, we believe it would set a bearish fundamental outlook for the GBP/USD this week. Therefore, if the GBP/USD fails to close above the resistance near 1.3320, it would likely attract additional bearish momentum in the market and move south towards the 1.3050 level.

Hence, once the GBP/USD price gets rejected around 1.3320, Australian Forex traders should look out for trading opportunities below this major resistance level.

Asif worked as a prop trader for almost a decade, and later he managed trading operations for one of the largest foreign exchange strategy developers in Europe. Currently, he works as a trading consultant to several brokers and writes about various tech and financial topics. You can reach him at contact@asifimtiaz.com

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Asif Imtiaz

Asif worked as a prop trader for almost a decade, and later he managed trading operations for one of the largest foreign exchange strategy developers in Europe. Currently, he works as a trading consultant to several brokers and writes about various tech and financial topics. You can reach him at contact@asifimtiaz.com

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