- British Pound after trading as low as 1.4494 against the US Dollar started correcting higher.
- GBPUSD closed back above the 1.4540 level, but facing a major resistance area near 50 hourly simple moving average.
- Chinese Consumer Price Index was the main economic release earlier today, which was reported by the National Bureau of Statistics of China.
- The Chinese CPI registered a rise of 1.6% in December 2015, less than the market expectation of 1.7%.
The GBPUSD pair was crushed during this past week, and the pair traded towards the 1.4500 support area. Somehow, buyers managed to protect more losses and pushed the pair higher. However, the 50 hourly simple moving average is acting as a resistance and stalling gains.
Moreover, there is a bearish trend line on the hourly chart that may act as a hurdle for buyers and push the pair back lower. The 100 hourly MA is also positioned above it.
Overall, there are many resistance levels on the way up starting with the 50 MA, trend line and then the 100 MA.
Today, the Chinese Consumer Price Index report (by the National Bureau of Statistics of China) was released that impacted the market sentiment. The market was expecting an increase of 0.4% in December 2015, compared Nov 2015 but the outcome was positive, as the Chinese CPI gained 0.5%. However, on the other hand, the yearly change was disappointing, as the CPI came in at 1.6%, compared with the forecast of 1.7%.
The GBPUSD managed to gain bids since the Asian session, and recovered well.
However, we need to keep an eye on the resistance trend line along with the 50 hourly MA for more gains in the near term.