- Sterling faded the initial up-tick in the wake of the release of UK’s Construction PMI.
- GBP failed to benefit from upbeat UK’s construction PMI which came in at 56.0 in May, beating forecasts and up from April’s 53.1.
- Investors preferred to remain on the slide-lines ahead of next week’s crucial UK general election.
- The pair is holding daily gains near 0.8720 region, upside bias intact.
- Price action above 200-DMA (0.8596) and daily cloud, bias higher. Technicals studies on weekly charts also support upside.
- Scope for further upside on break above 0.8761 (50% Fib retrace of 0.92253 to 0.82970 fall). Bullish invalidation on break below 200-DMA.
Support levels - 0.87, 0.8651 (38.2% Fib), 0.8597 (200-DMA), 0.8571 (20-DMA)
Resistance levels - 0.8761 (50% Fib), 0.8787 (Mar 13 high), 0.8852 (Jan 16 high)
Recommendation: Good to go long on break above 0.8762, SL: 0.8650, TP: 0.8790/ 0.8850/ 0.8870
FxWirePro Currency Strength Index: FxWirePro's Hourly USD Spot Index was at 68.1476 (Bearish), while Hourly JPY Spot Index was at 42.837 (Neutral) at 0340 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
