As Thursday elapsed, we experienced rather busy but tranquil day for British economy. Main data releases turned out to be virtually equal with forecasted values, which accounts for calm price reaction on them. Three weighty economic indicators were issued. Namely, Halifax HPI MoM, BoE QE Program and BoE Interest Rate. First figure Halifax HPI, illustrating change in the price of homes financed by HBoS, dropped 1.9 percent over previous month and is now -0.1 percent high. Mentioned change was driven by significant economical issues – higher number of properties to sell and lower demand. This fundamental outlook of the problem might indicate that homes prices in UK are likely to fall further during next months. Asset Purchase Facility emerged unchanged. Current amount of starlings dedicated on bond purchasing program, 200 billion of pounds, remains at the same level since November 2009. Issued at the same time as Asset Purchase Facility, BoE Interest Rate remained unchained as well, which was in line with expectations. Hence, mentioned information didn’t trigger any movement on GBP index, and thus GBPUSD chart.
Glancing at the GBPUSD chart, it is apparent that pair is stuck in the long downtrend. If current upward correction will breach trend line plotted from the high from 4th November, enduring trend may switch to upward. Significant supports are levels of 1.5656 and subsequently 1.5511.
Combining technical analysis with general U.S. economy outlook, we are biased toward bearish scenario on GBPUSD chart.
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