Key Points
- The British Pound was crushed against the US Dollar and looks set for more losses in the near term.
- There is a bearish trend line formed on the hourly chart of the GBPUSD pair, which is acting as a resistance for the pair.
- The UK Gross Domestic Product was released by the National Statistics earlier today.
- The outcome was positive, as the preliminary reading came in at 0.6% in Q2 2016, compared with the forecast of 0.5%.
Technical Analysis
The British Pound traded lower against the US Dollar and tested an important support area of 1.3080, which provided bids. There is a bearish trend line formed on the hourly chart of the GBPUSD pair, which is stalling the upside move.
The pair is below the 21 hourly simple moving average, which is a concern for the buyers in the short term.
On the downside, a break below the highlighted support area may call for more losses in the near term.
UK GDP
Today in the UK, the Gross Domestic Product, which is a measure of the total value of all goods and services produced by the UK was released by the National Statistics.
The forecast was lined up for a rise of 0.5% in Q2 2016, compared with the previous quarter. However, the result was positive, as there was an increase of 0.6%. The report stated that “Output increased in 2 of the main industrial groupings within the economy in Quarter 2 2016. Services increased by 0.5% and production increased by 2.1%. In contrast, construction decreased by 0.4% and agriculture decreased by 1.0%. GDP was 2.2% higher in Quarter 2 2016 compared with the same quarter a year ago.”
The GBP bulls were not impressed after the release, as the GBPUSD pair was seen struggling during the London session.
