The Great Britain Pound (GBP) gains strength against the US Dollar (USD), increasing the price of GBPUSD to more than 1.2500 ahead of Britain’s industrial production report which is scheduled for release on Friday. The technical bias has turned bullish after the emergence of bullish pin bar a couple of days ago.
GBP/USD Technical Analysis
As of this writing, the pair is being traded near 1.2513. A hurdle may be noted around 1.2675 (the trendline resistance area) ahead of 1.2700-1.2706 (the high of last major upside move & psychological number) and then 1.2774 (the high of December 6th, 2016) as demonstrated in the given below daily chart.
On the downside, the pair is likely to find a support near 1.2400 (the trendline support area as well as psychological number) ahead of 1.2346 (low of the bullish pin bar emerged on Tuesday) and then 1.1986 (the low of 2017). The technical bias shall remain bullish as long as the 1.2346 support area is intact.
UK Industrial & Manufacturing Production
The National Statistics department is scheduled to release the Britain’s industrial production data on Friday.
According to median projections of different economists, the industrial production activity remained 0.2% in January as compared to 2.1% in the month before:
Similarly, the industrial production remained 3.2% in January as compared to 2% in the same month of 2016, the projections say.
On the same day, manufacturing production data is also scheduled for release by the national statistics department. As per the forecast of economists, the manufacturing production increased by 0.5% in January as compared to 1.3% in the month before:
How GBP/USD Reacted to Production Data Last Month?
Britain’s manufacturing and production figures are considered medium-level news releases that do not incite high volatility in the price of cable. Last month, the impact of production news was quite negligible, the effect was lasting only 30 minutes after the release.
The pair moved 30 pips soon after the release and then came back to where it was before the release of data.
How to Trade Industrial/Manufacturing Production News
If the overall data comes better than the forecasts of economists, then traders expect a 20-40 pips upside move in GBPUSD within 30 minutes after the news releases. Conversely, if the data comes below the median projections of economists, then we expect negligible to small downside move in Sterling’s exchange rate within 15 to 30 minutes after the release.