UK Economy and GBP – You Can’t Catch Me Now
Skerdian Meta • 1 min read
Last evening, we took a look at GBP/USD and highlighted a couple of support and resistance levels. One of these levels is 1.28 and this morning we´re another yard closer to this support-turned-resistance level.
The UK prelim GDP report gave GBP traders another reason to push higher to 1.2670s. This is the first GDP reading, with two more to come, but the GDP numbers in EU and UK don't really change much (if any) from one reading to another, unlike in the US. So, it´s likely that this will be the final reading, as well in a few months time.
The UK Q1 GDP came out at 0.6% against the expected 0.5%, and the yearly number beat expectations as well. This Brexit thing is having little to no impact on the UK economy and the reason for this is the UK consumer, which has remained robust.
Everyone expect the UK economy is to collapse, yet it keeps expanding as the UK GDP chart shows.
Although, I see that GBP pairs are about 70-100 pips lower now. GBP/USD threatened 1.27 after the release, but it's threatening the downside now at 1.26. That shows that the market is getting nervous ahead of the big 1.28 resistance level.
This falls in line with my expectations/preferences of GBP/USD closing the week below 1.28. I'm still hoping that we get up there sometime next week so we can open a long term sell forex signal in this pair.