Global macro overview for 06/01/2017:
The economic data from the United Kingdom for last half of the year were far better than most economists and market participants expected. Recently, at an event at the Institute for Government in London, Andy Haldane, the Bank of England's chief economist, said there was a "disconnect" between political warnings about Brexit and the "remarkably placid" state of the markets, adding that the worst predictions may turn out to be "just scare stories". As we remember, Mark Carney, the Governor of the Bank of England, warned before the referendum that Britain could face a "technical recession" if it voted to leave and said Brexit represented the "biggest domestic risk" to the UK's financial stability. Nevertheless, since the referendum we have not seen a sharp slowdown in the economy and the Bank of England has even ugraded its economic forecasts.
Let's now take a look at the GBP/USD technical picture in 4H time frame. The bulls have managed to rally towards the 38%Fibo of the overall swing down, but the price was capped at the level of 1.2432 and currently is falling slowly back to the trading range. The next support is seen at the level of 1.2267 and the next resistance is seen at the level of 1.2432.
