- British Pound recovery against the US Dollar failed around the 1.4360, as the GBPUSD pair started to move down.
- The pair is trading near a major support area in the form of a bullish trend line on the hourly chart, along with the 100 hourly simple moving average.
- In the UK, the CBI Industrial Trends Survey released by the Confederation of British Industry posted a decrease from the last reading of -7 to -15 in January 2016.
- GBPUSD is facing a lot of selling pressure, which may continue in the near term.
The GBPUSD after testing the 1.4350-60 resistance area failed and started correcting lower. The pair even cleared the 200 hourly simple moving average, and currently testing the 100 hourly simple moving average.
Moreover, there is a bullish trend line formed on the hourly chart, which is acting as a support and preventing a break.
As long as the pair is above the trend line and 100 MA, it may recover and trade back higher in the short term.
UK CBI Industrial Trends Survey
The UK saw only one economic release today, as the CBI Industrial Trends Survey, which gives expert qualitative opinion from senior manufacturing executives, on past and expected trends in output, exports, prices and costs was published by the Confederation of British Industry. The forecast was lined up for a decrease from the last reading of -7 to -10 in Jan 2016. However, the outcome missed the mark, as the CBI Industrial Trends Survey dropped to -10.
The report added that the “Total unit costs and domestic prices both fell back slightly over the three months to January. Competitiveness abroad for manufacturers remains under intense pressure with sixteen of 18 sub-sectors saying that their competitiveness in the EU was down on three months ago”.
The GBPUSD is facing a tough test near the 100 MA. A break below it may call for more declines moving ahead.