Key Points
- The British Pound is currently attempting to trade higher versus the US Dollar, but faces a major resistance.
- There is a crucial bearish trend line formed on the hourly chart of the GBPUSD pair, which may stop the current upside move.
- Today in the UK, the Retail Sales report was released by the National Statistics.
- The result was on the higher side, as there was a rise of 6.2% in August 2016, more than the forecast.
GBPUSD Technical Analysis
The British Pound declined a few pips recently against the US Dollar to trade near 1.3200 where the bulls appeared. The GBPUSD pair is currently recovering and already broke the 21 hourly simple moving average.
However, the pair faces a major resistance on the upside in the form of a bearish trend line on the hourly chart.
Only a break above it could trigger sustained gains in the GBPUSD pair in the near term.
UK Retail Sales
Today in the UK, the Retail Sales report, which measures the total receipts of retail stores was released by the National Statistics. The forecast was slated for a rise of 5.3% in August 2016, compared with August 2015.
However, the result was better than the forecast, as there was an increase of 6.2%. This positive result may help the British Pound in gaining traction moving ahead. The report added that the “quantity bought decreased by 0.2% compared with July 2016; the largest contribution to the decrease came from non-food stores which was offset by increases in non-store retailing, predominantly food stores and petrol stations. The underlying pattern in the retail sector is still one of growth with the 3 month on 3 month movement in the quantity bought increasing by 1.6%”.
Overall, the British Pound may gain traction, and if it break the trend line resistance, then further upsides are possible.
