GBP/USD looks vulnerable

By Mark Jensen

GBP/USD has been descending for 2 weeks an arrived to $1.6465 yesterday. For now pound’s trading about 30 pips above this level.

Britain will release inflation data at 09:30 GMT. Forecast for CPI is 1.7% vs. the previous reading of 1.9%. Pound may fall in case of soft figures as the bets for the Bank of England’s policy normalization will decline in this case.

On the daily chart GBP/USD slid below the Ichimoku Cloud – negative signal. Last week the pair fell below the 55-day MA ($1.6545) which is now acting as resistance ahead of $1.6625 (Kijun-sen) – yesterday there was a spike towards this level. Sterling looks vulnerable and may test support of the line connecting November and February lows. Support lies at $1.6423 (100-day MA), $1.6350 and $1.6250.

Chart. Daily GBP/USD

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