- The Sterling remained in bearish tone against dollar on Thursday as a mixed bag of output and trade data did little to alter investors' downbeat view of an economy struggling to meet Bank of England targets.
- The pound fell by as much as a third of a percent in early US trade to as low as $1.2952 before recovering some ground after industrial production numbers just topped economists' forecasts.
- Construction output was weaker than expected and other readings showed Britain's enormous external trade gap expanding further despite the weakening of the pound over the past year.
- The pound has lost more than 13 percent in trade-weighted terms since last year's decision to leave the European Union but Britain's trade deficit with the rest of the world remains huge.
- Further upside in this pair is expected to be limited as the pair finds strong resistance at 1.3066 which should limit further upside and bring decline towards lower levels in the short term.
- To the upside, the strong resistance can be seen at 1.3066, a break above this level would expose to cable to next resistance level at 1.3100.
- To the downside immediate support can be seen at 1.2947, a break below will open the door towards next level at 1.2906.
Resistance Levels
R1: 1.3000 (38.2 % Retracement level)
R2: 1.3066 (61.8 % Retracement level)
R3: 1.3100 (Psychological levels)
Support Levels
S1: 1.2947 (38.2 % Retracement level)
S2: 1.2906 (June 4th lows)
S3: 1.2870 (23.6 % Retracement level)
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