GBPUSD shows potential for a short-term recovery
This is a big week for economic data out of the UK, beginning with an inflation update on Tuesday, then retail sales and the Bank of England monetary policy statement on Thursday. Even though data released since the last Bank meeting has been mixed, the statement will probably be little changed and therefore reinforce the likelihood of a May rate hike.
Management and risk description
In the short term, Sterling has completed a requisite Elliott Wave corrective structure from last week’s 1.3995 high. While holding support at 1.3915/1.3890, we are looking for rally above 1.3995 resistance to herald a recovery towards 1.4070 and 1.4145 over the coming days.
Entry: Today Only: Sterling is seen as a Buy on reaction to around 1.3920 (provided it doesn’t rally toward 1.3995 first).
Source: ThomsonReuters. Create your own charts with SaxoTrader; click here to learn more.