The construction sector of the UK economy dropped from its previously recorded figure of 64.6, but managed to stay just above the 60.0 level mark, but that did not seem to please the investors yesterday as they preferred shorting the GBP/USD pair in the US session where it closed below the critical level of 1.6683 and 1.6699.
The investors are looking ahead to today’s very important economic indicator of the UK economy where its services sector data would be released, and a good outcome could lift the pair up where buyers are suggested to enter the market above the resistance level of 1.6716. On the other hand, a bad outcome or even a mixed result of the services data could allow the sellers to stay intact with the pair where a move below its support level of 1.6648 could drag it down further to 1.6616 and 1.6599, where buy pending orders are set to give the pair a little support.
The cash rate or the interest rate for the Australian economy has been kept the same at 2.5% by the Reserve Bank of Australia, which gave the pair good volatility during the release of the data, but the Aussie couldn’t manage to find a clear direction during the whole day on Tuesday.
Those who follow the price action theory blindly on this pair should consider themselves as wise where its support given at the 0.8886 level was quite strong and since the pair is currently trading at 0.8942 so it has a cluster of support levels below this price. However, it is recommended to play safe and enter as long on the pair only if the pair manages to break its resistance levels and move above the major resistance area of 0.8891.
Wait; keep your long positions open. The sudden downward move given by the metal on Tuesday from its 1350 level down to 1331 support level is just a bearish correction that it has completed on its Fibonacci retracement scale. Its next targets would be 1365 and 1375 provided that it moves above the 1354 resistance area.
To contact the reporter of this story: Jonathan Millet at firstname.lastname@example.org