- The British Pound declined heavily due to Brexit and created a new 31 year low versus the US Dollar.
- There was a support trend line formed on the hourly chart of the GBPUSD pair, which was broken and may act as a resistance moving ahead.
- In the UK, the PMI Construction was released by the Chartered Institute of Purchasing & Supply and Markit Economics.
- The outcome was positive, as there was an increase from the last reading of 49.2 to 52.3 in Sep 2016.
GBPUSD Technical Analysis
The British Pound suffered heavy losses today, as it fell below the last low and formed a near low below 1.2800. Before the downside move, the GBPUSD pair broke a support trend line formed on the hourly chart.
Now, there is a minor bearish trend line formed on the same chart, which can be seen as a resistance if the pair attempts to recover from the current levels.
A break below the recent low of 1.2759 may take the pair towards the 1.2700 handle in the near term.
UK PMI Construction
Today in the UK, the PMI Construction, which shows business conditions in the construction sector was released by the Chartered Institute of Purchasing & Supply and Markit Economics.
The market was expecting a minor decline from the last reading of 49.2 to 49 in Sep 2016. However, the result was above the forecast, as there was a rise to 52.3 in Sep 2016. The report stated that “September data highlighted an upturn in business activity across the UK construction sector for the first time since May, primarily driven by a recovery in residential building. New orders also rebounded during September, which ended a four-month period of sustained decline”.
The result was positive, but the market sentiment is negative for the British Pound. So, the GBPUSD pair may decline further moving ahead.