GBP/USD: forecast for April 18-24
By Kira Iukhtenko
The British pound attempted to recover at the beginning of the new week, but was capped by the 1.4350 mark. The pair is forming a candle with a long upper shadow on the weekly chart. The picture remains bearish and we expect the pair to break lower in the nearest future. Key support for the pair lies at 1.4090 and 1.4050. A break below 1.4050 would trigger a quicker selloff.
As can be seen from the H4 chart, the pair is now trading in a corrective bullish channel. The 1.4200 resistance is now crucial – a break higher would open the way for more upside correction, while the move will likely be limited by the 1.4300 area. The cable’s recovery will be limited by the 1.4250 area.
On the new week we’ll watch the UK labor market data on Wednesday. Unemployment held at its lowest level since 2008 in February. On Thursday, retail sales are scheduled for release. In February the reading fell by 0.4%. We’ll see whether anything changed in March.