GBP/USD on the Defensive Ahead of UK Employment / Budget Statement
- GBPUSD on the defensive ahead of UK Employment / Budget Statement / FOMC
- Immediate focus lower- broader bullish invalidation at median-line support
- Updated targets & invalidation levels
Chart Created Using FXCM Marketscope 2.0
Technical Outlook: Sterling reversed off key confluence resistance on Friday with the pullback breaking below channel support today, keeping the immediate short-bias in focus heading into tomorrow’s UK employment report and the subsequent budget statement by Chancellor of the Exchequer George Osborne. Interim support rests at 1.4131/35 backed by the 61.8% retracement at 1.4064 & 1.4031. That said, we’ll be looking for a low in price this week in the exchange rate with the broader bias remaining weighted to the topside while above the lower median-line parallel (blue) currently around ~1.3945/50.
Interim resistance stands at 1.4205 with a breach above basic trendline resistance off the weekly high needed to clear the way for the resumption of the broader advance off the yearly low. Continue tracking this setup and more throughout the week- Subscribe to SB Trade Desk and take advantage of the DailyFX New Subscriber Discount!
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- The DailyFX Speculative Sentiment Index (SSI) shows retail crowd remains net-long GBP/USD since November 19, with positioning climbing to an extreme in January as the ratio pushed above +3.00.
- Retail FX sentiment continues to move away from recent extremes as the ratio narrows to +1.81, with 64% of traders now long.
Why and how do we use the SSI in trading? View our video and download the free indicator here
Relevant Data Releases This Week
Other Setups in Play:
- AUD/USD Pullback Targets Near-term Support Ahead of FOMC, Aussie Jobs
- AUD/JPY Fails at Resistance Ahead of RBA Minutes- Support 84.72
- Webinar: USDOLLAR FOMC Preview- Key Levels to Know
- AUD/CHF Deeper Sell-Off to Offer Favorable Entries
- GBP/USD Coils Below Key Resistance- Bullish Invalidation 1.3920
---Written by Michael Boutros, Currency Strategist with DailyFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.