The British currency demonstrated stable growth against US dollar during trading on Tuesday, September 5, marking a new local maximum since August 8. The reason for the “bullish” activity was weak positions of the US currency that is under pressure due to uncertain prospects of tightening of the Fed’s monetary policy in the end of the year.
Yesterday the investors were discussing the results of the statement made by the Fed’s representative Lael Brainard. She pointed out that the regulator had to be cautious about further interest rate increases as it could not be sure inflation would reach target levels of 2%.
On Wednesday, September 6, investors are waiting for the release of PMI statistics from the USA for August, as well as for the release of the Fed’s Beige Book at 20:00 (GMT+2). Interesting statistics from the UK is due on Friday when the data on consumer inflation and industrial output for July will be released.
Support and resistance
Bollinger Bands in D1 chart demonstrate stable increase. The price range is widening. MACD indicator is growing preserving a stable buy signal (the histogram is above the signal line). Stochastic has returned to growth after a decrease attempt in the beginning of the week.
Resistance levels: 1.3042, 1.3079, 1.3110, 1.3157.
Support levels: 1.3000, 1.2975, 1.2936, 1.2906, 1.2876.
Long positions may be opened from the level of 1.3042 with targets at 1.3157, 1.3185 and stop-loss at 1.2975. The period of implementation is 2-3 days.
A reversal near the level of 1.3042 may indicate the opening of short positions with target at 1.2936 and stop-loss at 1.3075. The period of implementation is 2-3 days.