The GBP/USD is planning to bounce upwards | 09 September 2014

Euro

We do not expect important macroeconomic statistics the first part of the new trading week. It should be emphasized the Germany trade balance release. There was an increase in the industrial production in July which together with the moderately positive PMI data points to the release within the forecasted medians. We have seen the single European currency sale against the dollar and the pound in July that was also positive for the export growth.

The support levels are 1.2870- 1.2890, and the resistance levels are 1.2960 - 1.2980.

MACD is in a negative territory.

Trading recommendations

The medium-term perspectives are still negative and we also expect the support break towards 1.2780-1.2800. However, in the short term, given the fact that the pair is strongly oversold, we expect a consolidation in the range below of 1.2960 or a short bounce to the levels of 1.3100-1.3120 area and then the downtrend will be resumed.

Pound

Today there will be held inflation parliamentary hearings and until that time, the traders will not rush with the position opening. The Brent August price fell by 2.46% which will cause the August inflationary pressures weakening. The CPI decline is the negative factor for the BoE monetary policy tightening. However, it laid down in the current quotes so we shouldn’t expect the pound strong sales on Tuesday. The pair sharply fell at yesterday trading.

The support levels are 1.6110 - 1.6130, and the resistance levels are 1.6200 - 1.6220.

MACD is in a negative territory.

Trading recommendations

The pair started the week with a gap down, and at the moment it tries to consolidate below 1.6200. If it succeeds, it will open the level of 1.6040 area breakthrough possibility. If the pair manages to return above 1.6200, it will increase the bounce probability towards the resistance level of 1.6300.

Yen

The Japan's GDP second estimate for the 2nd quarter was published. The consensus - the Wall Street economists forecast refers to the values revision for the worse, however, the total value may be coincided with the preliminary data, because at the moment there is no reason for the significant deterioration. The investors' attention is drawn to the Japan and the United States stock markets. The stock index S&P500 is configured to update the historical maximum and therefore we can expect the dollar/yen moderate demand.

The support levels: 105.60- 105.80, and the resistance levels: 106.30- 106.50.

The MACD indicator is in a positive territory.

Trading recommendations

The market tested the short-term target at 105.80. We expect the upward movement continuation.

We advise to hold the buying position with the target to the medium-term resistance level of 106.30 area and the protective order at the level of 104.70.