GBPUSD threatening for more downside moving ahead (extract from Weekly Market Forecast 26th of October 2014)

The British pound somehow managed to hold the 1.60 support level against the US dollar during this past week, but there is a chance that the GBPUSD pair might continue heading lower in the short term. The weekly and monthly charts are still bearish which suggest that the downtrend is still intact in the short term. That’s why I think we should be looking for possible sell opportunities moving ahead.

There is an important channel forming on the one hour chart of the GBPUSD pair. There is also a critical support area around the 200 moving average, as can be seen in the chart above. If the pair manages to move a bit lower from the current levels, breaks the mentioned support area and settles below the same, then we can enter into a sell trade.

Initial target should be around the 1.5980 level, and final target could be around the 1.5910 level. Stop should be placed above the broken support area.

Major events scheduled in the upcoming week
There was no decisive move in the US dollar this past week, as the Forex market was mostly in the mood of consolidation. The US consumer price index release was a mover to some extent, but that too failed to overcome the sentiment. We need to see how the US dollar behaves in the upcoming weeks. The economic data in the UK was mixed, which somehow managed to hold the downside in the GBPUSD pair. However, it remains at risk as the British pound sellers are not willing to give up, which is a negative sign in the short term.

Let us look at all major events lined up in the upcoming week.
Sunday – No economic release.

Monday – German IFO business climate index, US pending home sales and Japanese retail sales.

Tuesday – US durable goods orders, CB consumer confidence and Japanese industrial production.

Wednesday –FOMC rate statement and RBNZ interest rate decision.

Thursday – Spanish GDP, German unemployment data, US GDP, US initial jobless claims, Fed’s Yellen speech, German CPI, Japanese CPI and Australia’s PPI.

Friday –German retail sales, Euro zone CPI, Euro area unemployment, Chicago PMI, Michigan consumer sentiment and Chinese manufacturing PMI.

This analysis is taken from Weekly Market Forecast, which also includes trade opportunities on: GBPCHF, EURGBP, USDJPY, EURJPY, GBPJPY, AUDUSD, NZDUSD, AUDNZD, EURAUD, USDCAD and AUDCAD.
Get it HERE: Vladimir’s Markets Forecast

Happy trading friends!