GBP/USD: Weekly Technical Analysis for February 16, 2014

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Weekly bias in GBP/USD remains on the upside after price penetrated through 1.66660 resistance, the highest it has made since April 2011. Demand for the pair was fueled after the pair found strength with on-going speculation that the Bank of England will likely hike its rates before it currently envisions. Moreover the U.S economy saw a disappointing retail sales figure which weakened the greenback against all major currencies.


However we might experience some consolidation in the pair in the early week or a decent retracement to make a wave 2 (Elliot wave) in the current bullish trend, as Stochastic and RSI are signaling an over-bought market in the pair. I strongly recommend picking buy trades from the dips as to minimize risk as more buying could be seen to 1.70430 zones (August 2009 resistance).


Key economic indicators to watch out for in the coming week in the Great Britain’s economy is the CPIy/y , Claimant Count Change, MPC Asset Purchase Facility Votes,  MPC Official Bank Rate , Unemployment Rate and lastly its Retail sales, which would be a major determinant whether more strength or slight weakness would be seen in the GBP currency.




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