19.05.201503:19 Forex Analysis & Reviews: Technical analysis of GBP/USD for May 19, 2015

Long-term review

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Major economic data starts from today onwards. Today, traders eye CPI y/y. The April CPI reading was slightly negative. The core CPI stayed at 1%. A fall in the inflation rate leads to a fall in oil prices. In April 2014 the inflation rate paused at 1.8%. Today and tomorrow are likely to be big days for the pound and greenback. We expect wild moves favoring bears. I expect the near term to be capped at 1.5840. In case intraday moves spike up ahead of the FOMC meeting, bulls can extend 1.5960/1.6000. But chances are remote. Last week, we noted the cable waiting for a minor correction. As of now, the cable lost 177 pips from recent highs. The nearest support is found at 1.5630 and 1.5600 200Dsma. At yesterday's session, the cable made a low at 1.5638. For an intraday session, we recommend selling below 1.5630 with targeta at 1.5600, 1.5590, and 1.5550. In case the price closes below 1.5545, bears aim at 1.5440 and 1.5410. Intraday resistance is seenat 1.5680 and 1.5725. Bullish momentum is expected above 1.5725 towards 1.5800/1.5810.

Trade: Selling below 1.5630

To contact the author of this analysis, please email- joseph.wind@analytics.instaforex.com

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