The UK GDP growth rate increased by 0.3% in the Q1 (Jan to Mar), 2015, compared with 0.6% in the Q4 (Oct to Dec) 2014. Services output increased by 0.5% in theQ1 (Jan to Mar), 2015. Before the UK election, the UK economy growth rate slowed in the Q1. This was the slowest pace since 2012. This may be a bit concern to the Cameron. Ahead of the FOMC meeting, the consumer confidence generated a bearish signal for the interest rate hike. Traders are expecting dovish signal to lead to another leg down of USD. The pound has been maintained upbeat for the third consecutive week. The cable managed to close above 20Wsma after 37 weeks. The cable has parallel resistance at 1.5552 that is the previous swing high in the daily chart. The cable became strong after it had closed above 10Dsma and 100Dema. As we advised earlier, we might see big move above 1.5000. Now, the cable gave 340 pips on the higher side. We expect bulls to extend their rally towards 1.5429, 1.5480, and 1.5556 200Dsma. Today, the cable has managed to erase most of the previous monthly losses. The cable gave a bullish inverse head and shoulder break targeting 1.5340, which was done at yesterday's session. Though, the cable closed above 20&50Dsma, bullish crossover is not in place yet.
Intraday view: Intraday support is found at 1.5328 and 1.5300. Resistance is seen at 1.5350 and 1.5375. We recommend buying above 1.5350 with targets at 1.5375, 1.5400, 1.5425, 1.5450, 1.5480, and even 1.5550. On the downside, we recommend selling below 1.5320 with targets at 1.5300, 1.5260, 1.5200, and 1.5160. The 100Dema is found at 1.5220 and 100Dsma at 1.5175. These are the key support levels to be hold by bulls to extend the rally. Technically speaking, until the price closes above 100Dema/100Dsma, bullish views remain in play. The 50Dsma is found at 1.5020 and strong support is found at 1.5000, which was acted as strong resistance earlier. Now, it turned to support.
Key support levels:
100DEMA 1.5220
100DSMA 1.5175
20WSMA 1.5150
50DSMA 1.5020
20DSMA 1.4940
Resistance levels:
200DSMA1.5556
200DEMA 1.5700
The technical levels mentioned above have been provided ahead of big events such as the FOMC meeting and the next week's UK general election. We expect wild moves in the week to come. In the four-hour chart, RSI is found at the extremly overbought level at 77.