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GBPUSD Trading within the Local Rising Channel

12/23/2022 12:24 PM

After the publication of the report on the dynamics of the British gross domestic product (GDP), the GBP/USD pair shows negative dynamics and is likely to end the week at current levels around 1.2040.

The Q3 economy lost 0.3%, slowing the rate to 1.9% YoY from 4.4% earlier, according to the final estimate from the country's Bureau of National Statistics, indicating that a full-fledged recession will set in next year. Also, business investment declined by 2.5% over the same period after rising 6.2% a quarter earlier, while the value for commercial enterprises declined by 1.3% after rising by 5.5% earlier.

The decrease in the asset was also facilitated by the dynamics of the US dollar, which consolidated above 104.000 in the USD Index for the first time this week. According to published statistics, the Q3 US economy increased by 3.2% after growing by 2.9%, which experts perceived as a delay at the start of the recession. Initial jobless claims justified the forecasts, amounting to 216.0K against 214.0K a week earlier, but at the same time, did not significantly affect the market.

On the daily chart, the trading instrument moves within the local ascending channel, falling toward the support line.

Technical indicators are weakening the buy signal: the range of EMA fluctuations on the Alligator indicator is actively narrowing, and the histogram of the AO oscillator is forming downward bars, falling in the buying zone.

Resistance levels: 1.2180, 1.2440. | Support levels: 1.1940, 1.1630.

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