The pound rebounds to a 4-week high against USD. Soft US data helped the cable at yesterday's session. Ahead of the FOMC meeting scheduled for Wednesday, traders eye Yellen's comments. Traders are expecting fresh projection about the US economy and the interest rate long-term outlook.
The UK traders eye CPI data. We expect a 0.1% uptick from negative readings. Besides, US housing starts and building permits are due. We expect good volatility during today's session.
Technical view: The weekly resistance is seen at 1.5710 and 1.5800. Monthly resistance is seen at 1.5930. The trend favours buying on dips. In the hourly and daily charts, the cable has moving towards higher lows and higher highs. The cable closes above 20Wsma and all daily moving averages. These factors support pound bulls. The weekly support is found at 1.5330 and strong support is seen at 1.5170. Monthly support is found at 1.5089. We have been advising targets at 1.5440 and 1.5700 with sl 1.5170. As of now, the cable hit a high of 1.5614. Intraday is seen between 1.5620 and 1.5630. Bulls aim at 1.5670 and 1.5700 in case they manage to breach the level of 1.5630. In case of a daily close above 1.5700, bulls will aim at 1.5800 and 1.5940 in a day or two.
The selling pressure emerges below 1.5530 with small targets at 1.5510/1.5500, 1.5485/1.5470, and 1.5440. Selling will accelerate below 1.5420 with targets at 1.5400 and 1.5370. The panic will be triggered below 1.5370 towards 1.5340 and 1.5300.
Trade: Safe buying above 1.5630