The week was positive for the greenback. The US dollar index managed to set new highs near $93.50.
GBP/USD: forecast for Oct. 30 - Nov. 3
It was a volatile week for the British pound. GBP/USD made an attempt to break higher on Wednesday inspired by stronger-than-expected growth results. UK GDP growth accelerated from 0.3% in the second quarter to 0.4% in the third quarter. According to Chancellor Philip Hammond, the nation’s economic performance is “solid”.
Then, however, the pair recoiled down from resistance at 1.3265. Traders started to worry ahead of the approaching meeting of the Bank of England, which will take place on Thursday, Nov. 2. There’s still uncertainty about the longer-term picture for the British economy. As a result, although most analysts think that the central bank will raise its benchmark interest rate by 25 bps to 0.5% on Nov. 2, they are not sure that any further rate increases will follow. In addition, concerns about the progress of Brexit talks keep weighing on the pound.
Apart from the BoE meeting & the quarterly Inflation Report, the UK will release manufacturing PMI on Wednesday, construction PMI on Thursday and services PMI on Friday.
For the third time, 100-week MA at 1.3265 didn’t let the pair to get higher. This level continues to be the main resistance ahead of 1.3330 and 1.3500. Support is at 1.3060 (100-day MA) and 1.3000. A decline below the latter psychological level will open the way down to 1.2835 (200-day MA).
The pound is highly volatile after a Brexit referendum. Have a look what other factors affect the UK currency. And get clues on future movements of GBP.
This is Forex trading plan for Thursday, May 24…
It seems like the rally of the greenback has ended. On Monday, the US dollar index tested levels near $94, however, closed below $93.50.