Key Points
- The British Pound after a nasty fall against the Swiss Franc towards the 1.2510 found bids.
- There are a couple of important bearish trend lines formed on the hourly chart of GBPCHF, which are stalling a recovery in the pair.
- In the UK, the Trade Balance released by National Statistics posted a trade deficit of £-2.57B in May 2016.
- The UK Good Trade Balance posted a trade deficit of £-9.88B, less than the forecast of £-10.650B.
Technical Analysis
The British Pound started recovering against the Swiss Franc recently, but it won’t be an easy task for the bulls to take the GBPCHF pair higher. There are a couple of important bearish trend lines formed on the hourly chart, which are acting as a resistance for the pair.
The 100 hourly simple moving average is sitting just above the trend lines, which may also act as a hurdle if the pair attempts to move higher.
I think there are very less chances of the buyers taking the pair higher, as the resistance area is huge and sellers may be able to defend it successfully.
UK Trade Balance
Earlier today, the UK Trade Balance, which is a balance between exports and imports of total goods and services was released by the National Statistics. The market was expecting a trade deficit £-2.900B in May 2016. However, the outcome was above the forecast, as the trade deficit as £-2.57B.
Moreover, the report added that “In the 3 months to May 2016, the UK’s trade in goods deficit with the EU narrowed by £0.1 billion to £22.5 billion as exports increased by more than imports. In the 3 months to May 2016, the UK’s trade in goods deficit with the countries outside the EU narrowed by £2.6 billion to £8.2 billion, attributed to an increase in exports (6.8%).”
Overall, the highlighted trend lines and resistance hold the key in the near term for the next break in the GBPCHF pair.
