The currency pair continues to regain the losses incurred after the Brexit referendum after testing the level of 1.43 last week. True, the growth of the currency pair is still happening due to the weakening of the US currency, but nevertheless there was news last week that provided support for sterling. Market participants positively assessed the data on the labor market, which showed a stable situation with unemployment in the country, remaining at a record low level of 4.3%, and the same data on the growth of the country’s GDP, which were better than the forecast.
Positively assess the situation in the country and British officials. The Chairman of the Bank of England at the forum in Davos expressed the hope that the UK economy will gradually approach the accelerating rates of world economic growth, and the Minister of Finance appreciated the current rate of the pound sterling, noting that it should contribute to the normalization of the situation with inflation in the country, and also growth in real incomes of the population.
The absence of important economic news from the UK this week (with the exception of indexes of business activity in the construction and manufacturing sectors) will help maintain a positive news background for this currency pair, but adjustments in the balance of power can still be made by news from the United States.
On the chart, we get more and more signals about the possible beginning of a deep correction. Technical indicators since the end of last week are actively declining and now this decline is supported by price. If the bears manage to push support at 1.4100 in the near future, this will be a strong signal of a further decline in quotations with the target in the area of 1.3800. Count on the continuation of the uptrend
Review prepared by Fort Financial Services analytical department. Follow our publications!