Global macro overview for 26/02/2016:
The second estimate of the UK GDP had been released yesterday and the numbers were in line with market expectations. The Office for National Statistics reported that Britain's gross domestic product rose 2.2% last year, compared with the 2.9% growth in 2014. Moreover, the UK was the second fastest growing major economy in 2015, just behind the USA economy with the 2.4% growth. The IMF said that the economic performance of the UK was "strong", but warned that the referendum on the EU membership was a "risk and uncertainty". In conclusion, we can observe that the UK economy slowed sharply last year, but managed to recover modestly in the final quarter of 2015. Any further uncertainty regards more about a possible Brexit ( national referendum will be held at 23 June 2016) than the UK economy performance.
Let's take a look at the GBP/USD technical picture in the H4 time frame. After falling out of the brown channel, the market made a new local low at the level of 1.3879, but now is trying to reverse higher. The first resistance is seen at the level of 1.4058 and only a sustained breakout above this level would put bulls back in control.