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The Great Britain Pound (GBP) finally paused the nine-day long record breaking winning streak on Friday and continued falling today ahead of some key economic events. The technical bias remains bullish due to a Higher High in the ongoing upside rally.
Technical Analysis
As of this writing, the pair is being traded near 1.5716. A hurdle may be noted around 1.5800-1.5814, the confluence of psychological number as well as high of last week ahead of 1.5875, the 50% fib level as demonstrated in the following weekly chart.
On the downside, the pair is expected to find a support around 1.5566, the 38.2% fib level ahead of 1.5392, the low of the last weekly candle. The technical bias will remain bullish as long as the 1.5392-5350 support area is intact.
NAHB Housing Market Index
National Association of House Builders (NAHB) is due to release the housing market index report of the United States today during the early New York session. According to the average forecast of different economists, the housing market index remained 57 points in May as compared to 56 points in the month before. Generally speaking, higher housing market index is seen as positive for the US economy thus a better than expected actual outcome could spur renewed selling pressure in the price of GBPUSD and vice versa.
Trade Idea
Considering the overall technical and fundamental outlook, selling the pair around current levels appears to be a good strategy if we get a solid bearish signal in the form of bearish pin bar or bearish engulfing candle. It is always recommended to use proper risk and reward ratios to optimize your profitability in forex trading.
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