The pound sterling last week was seen to be successful in absorbing pressure by the US dollar supported by risky market sentiment in the wake of the Russia-Ukraine crisis. But can the situation be maintained by the Pound this week?
Early trading of the week will focus on the release of UK economic data for the manufacturing and services sectors in the European session to gauge the health of the current economy.
On the price chart of the GBP/USD pair, a bullish pattern was displayed last week but the resistance zone of 1.36400 has yet to be broken after being reached over the weekend.
The price eased back towards the 1.35700 zone at the close of trading last week before rebounding to rise at the beginning of the Asian session this morning for the early trading opening of the week.
The resistance zone around 1.36400-1.36600 will be tested again for a rise earlier in the week to give an indication for further movement.
If the price manages to pass the zone, the next target is to head around 1.37400 to test the resistance zone that was tested in January, thus recording the latest 6 -week high.
If the situation changes and a decline occurs, a decline below the level of 1.35700 will push the price to the level of 1.35000 to test again the RBS zone (resistance become support) after a few weeks the zone managed to support the rise again.
A lower decline beyond the RBS zone will give a clearer signal for the movement of the bearish trend for the price is likely to head to the level of 1.34000.
