Forex Market: GBP/USD daily outlook

During yesterday’s trading session GBP/USD traded within the range of 1.6510-1.6597 and closed at 1.6578.

At 8:45 GMT today GBP/USD was losing 0.09% for the day to trade at 1.6566. The pair touched a daily low at 1.6556 at 8:23 GMT.

Fundamental view

United Kingdom

Retail sales in the United Kingdom probably rose at a monthly pace of 0.5% in February, according to the median forecast of experts, following a 1.5% drop in January. Annualized retail sales probably climbed 2.4% last month, after another 4.3% gain in January.

Retail sales are a key indicator, providing clues over the tendency in consumer spending, while the latter is a driving force behind economic growth. A larger than projected rate of increase would certainly provide support to the pound.

Annualized retail sales, excluding volatile fuel expenditures, probably increased 2.9% in February, after a 4.8% gain during the preceding month. The official numbers are scheduled to be released at 9:30 GMT.

United States

United States final annualized Gross Domestic Product probably expanded 2.7% during the last quarter of 2013, according to the median estimate by experts. The revised GDP, announced on February 28th, was 2.4% during Q4.

This is the widest indicator for nations economic activity. A larger than expected increase in the GDP figure would boost demand for the US dollar. The official result is to be released at 12:30 GMT.

At the same time, the number of people who filed for unemployment assistance in the United States probably increased to 325 000 during the week ended on March 22nd from 320 000, registered during the preceding week. The weekly report on initial jobless claims, which reflects lay-offs in the country, is due out also at 12:30 GMT.

The index of pending home sales in the United States probably demonstrated a flat performance in February compared to January, when sales climbed 0.1%. This indicator shows activity in terms of signing contracts for purchases of existing single-family houses. Actual payments are made one to two months, after the contract has been signed. The National Association of Realtors (NAR) will announce the official index value at 14:00 GMT.

Technical view

According to Binary Tribune’s daily analysis, in case GBP/USD manages to breach the first resistance level at 1.6613, it will probably continue up to test 1.6649. In case the second key resistance is broken, the pair will probably attempt to advance to 1.6701.

If GBP/USD manages to breach the first key support at 1.6526, it will probably continue to slide and test 1.6475. With this second key support broken, the movement to the downside will probably continue to 1.6439.