- 1 GBP/USD – Technical Analysis for Australian Forex Trading
GBP/USD – Technical Analysis for Australian Forex Trading
United Kingdom – Manufacturing Production
On Thursday, at GMT 8:30 a.m., the UK’s Office of Labor Statistics will release the United Kingdom’s manufacturing production figure, which measures the total inflation-adjusted value of output produced by manufacturers in the country.
Since businesses are the first to react to changing economic climate and the manufacturing production makes up around 80% of the total industrial production in the United Kingdom, Australian forex trading investors consider this data to be a leading indicator of the overall economic health of the country.
Last month, the UK’s manufacturing production decreased by -0.2% and the forecast for this month is that it would remain unchanged at 0.0%.
United States – Core Consumer Price Index
On Friday, at 12:30 p.m., the US Bureau of Labor Statistics will release the month-over-month Core Consumer Price Index (CPI) data.
Since the Core CPI measures the changes in the price of goods and services but excludes the volatile food and energy prices, Forex investors consider this data to be more important compared to the CPI figure.
Last month, based on the US Core CPI, there were around 0.0% inflation in the economy. This month, the forecast is set at 0.2% inflation.
Since forming a bullish pin bar on March 14, 2017, the GBP/USD has climb up by around 1,065 pips over the last several months. However, last week, the GBP/USD found a strong resistance near the 1.3240 level and formed a bearish outside bar that seems to have started a bearish retracement. So far, the support near 1.3025 is holding the GBP/USD from falling further down.
As the UK’s manufacturing production is expected to remain unchanged at 0.0% over the last month, but the US core inflation level is expected increase by 0.2%, we believe it would set a bearish fundamental outlook for the GBP/USD this week. Therefore, if the GBP/USD breaks below the support around 1.3025, it would likely attract additional bearish momentum in the market.
Hence, Australian Forex traders should look out for trading opportunities below this major support level around 1.3025 level.
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