Key Points
- British Pound continued to move down vs the US dollar and tested the 1.4370-80 support area.
- There is an expanding triangle pattern formed on the hourly chart of GBPUSD, which is acting as a catalyst for downside move.
- There was a false break noted below the triangle support trend line, as the pair recovered to trade back inside.
- In the UK, the Halifax House Price Index released by the HBOS posted a decline of 0.8% in April 2016, more than the forecast.
Technical Analysis
The British Pound faced a lot of offers recently vs the US Dollar and traded below the 1.4500 support area. The GBPUSD pair also closed below the 100 hourly simple moving average and currently trading inside an expanding triangle pattern formed on the hourly chart.
As can be seen from the chart, there was a false break already below the triangle support trend line, pointing towards sellers’ strength.
Overall, the GBPUSD pair is under pressure, and any rally can be seen as an opportunity to enter a sell trade.
UK Halifax House Price Index
In the UK today, the Halifax House Price Index, which is the UK”s longest running monthly house price series presents house prices and property price movements on a like-for-like basis was released by the HBOS. The forecast was slated for a decline of 0.4% in the index in April 2016, compared with the previous month.
However, the result missed the mark, as the Halifax House Price Index posted a decline of 0.8%. In terms of the yearly change, there was a rise of 9.2% in April 2016, which was again less than the forecast of 9.6%.
Overall, the British Pound may remain under a bearish pressure and could trade towards 1.4350 in the short term.
