10.01.201815:11 Forex Analysis & Reviews: Euro and pound return part of positions

The euro managed to strengthen its position against the US dollar, despite the weak data on industrial production in France. The British pound also grew after a similar but more positive report on the UK.

According to a study by the Insee statistics agency, the volume of industrial production in France in November 2017 declined as a result of a slowdown in manufacturing.

Thus, industrial production fell by 0.5% compared with October, which fully coincided with the forecasts of economists. Data for October were revised downwards. Earlier, an increase of 1.9% was announced, while the final estimate was 1.7%.

Serious changes in the technical picture of EUR/USD relative to the morning forecast did not happen. Buyers got to the resistance of 1.2000, which, as expected, there was a decrease in demand for risky assets. Going beyond the above range will continue to buy the European currency with the update levels of 1.2045 and 1.2080.

The British pound significantly strengthened its position after the good data on industrial production growth, which were slightly offset by the growth of the negative trade balance of the UK.

According to the report of the statistics agency, the volume of industrial production in the UK in November rose by 0.4% compared with October 2017, which fully coincided with the expectations of economists. Data for October were revised upwards.

Good support was provided by manufacturing in the UK, where in November the growth was registered at 0.4%, which was even better than the forecasts of economists, who expected production to increase by 0.3%.

Today, data on the balance of trade in the UK also came, which again turned negative and increased in November to 12.2 billion pounds from 11.7 billion pounds in October.

This once again indicates that the disruption of trade relations and the withdrawal from the European Union negatively affects the UK economy, and until a fruitful dialogue is established in this direction, it is unlikely that there will be any improvement for the better.

As for the technical picture of the GBP/USD pair, here we should pay attention to the level of 1.3540, which is a kind of middle of the side channel, in which the pound is from the beginning of this year. If buyers manage to take this level and consolidate on it at the end of the day, it will be possible to confidently talk about continuing the upward trend in the trading instrument in the expectation of updating the monthly highs of 1.3580 and 1.3620.