GBP/USD – Pound Moves Higher Despite Solid US Numbers

GBP/USD has posted gains on Tuesday, pushing past the 1.68 line. In the US, Existing Home Sales remained steady and the Richmond Manufacturing Index surged in March. As well, the House Price Index, a minor indicator, met expectations. There are no British releases on Tuesday.

US Existing Home Sales has been on a long downturn, reflecting trouble in the housing sector. The key indicator edged lower in March, dropping to 4.59 million, down from 4.60 million a month earlier. However, it did beat the estimate of 4.57 million, marking the first time that the indicator has beaten the forecast since August. New Home Sales will be released on Wednesday, with the markets expecting an improvement in March.

US releases ended last week on a high note, as employment and manufacturing numbers were strong. The all-important Unemployment Claims was up slightly to 304 thousand, but had no trouble beating the estimate of 316 thousand. With the Federal Reserve planning another trim to its QE program at the end of the month and speculation rising about a possible interest rate increase next year, every employment release is under the market microscope. Meanwhile, the Philly Fed Manufacturing Index soared to 16.6 points, its best showing since September. This was well above the estimate of 9.6 points.

The ongoing crisis in Ukraine hasn’t had much of an effect on the markets until now, but that could quickly change if the charged situation spirals out of control. Russian President Putin has threatened to act on his “right” to invade Ukraine, and has steeply raised the price that Ukraine must pay for its gas supplies. Ukrainian Prime Minister Arseniy Yatsenyuk blasted the move as “economic aggression” and said his country must prepare for a complete cutoff of Russian gas. Meanwhile, US Vice-President Joe Biden is in Kiev in a show of support for Ukraine, and the US has said it will increase sanctions if no progress is made in resolving the crisis.

GBP/USD for Tuesday, April 22, 2014

GBP/USD April 22 at 15:30 GMT

GBP/USD 1.6826 H: 1.6840 L: 1.6786

GBP/USD Technical

• GBP/USD has posted gains in Tuesday trade. The pair crossed the 1.68 line late in the Asian session.
• 1.6765 is providing support. The next support line is 1.6705.
• 1.6896 is the next resistance line, protecting the key 1.70 level.

Further levels in both directions:

• Below: 1.6765, 1.6705, 1.6549 and 1.6416
• Above: 1.6896, 1.70, 1.7210 and 1.7374.

OANDA’s Open Positions Ratio

A large majority of the open positions in the GBP/USD ratio are short, indicative of a trader bias towards the dollar reversing directions and posting gains against the pound.

The pound has posted gains on Tuesday. The pair is unchanged in the North American session.

GBP/USD Fundamentals

• 13:04 US HPI. Estimate 0.6%. Actual 0.6%.
• 13:59 US Richmond Manufacturing Index. Estimate 0 points. Actual 7 points.
• 14:00 US Existing Home Sales. Estimate 4.57M. Actual 4.59M.

*Key releases are highlighted in bold

*All release times are GMT

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.