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GBP/USD Forecast 27 Apr 2016

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GBP/USD Forecast 27 Apr 2016
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The cable could strengthen without any fundamental data

Yesterday the cable was able to strengthen to 2.5-month high 1.4638. The reduced expectations of the Brexit have become the main driver of the strengthening of the British currency.

The results of the latest survey show that about 53% are ready to vote against Brexit.

So, today we have the pair GBP/USD above 1.45. The pair even tried to rise above 1.46, but was unable to gain a foothold. However, this growth of the pair is not supported by any fundamental data. Therefore, we can assume that the growth was caused by a sudden closure of the orders.

GBP/USD needs additional support factors, to go further. Today, this can be the meeting of the FOMC. If the FOMC members give soft comments, we don’t rule out attempts of the pair to climb above 1.46.

It’s also worth to say a few words about the meeting of the FOMC. Today, the committee may convince investors that the regulator is not prepared to tighten the economy at this stage. However, despite the weak outlook for the US economy, Fed officials may declare its readiness for further tightening at the June meeting, but with the comments "in case of the positive data"

How to trade

The short-term upward movement is possible in the range of 1.4632 - 1.4713. If the pair falls below 1.4541, the further movement is possible to the area of 1.4472. We buy call options if the pair rises above 1.4632. We buy put options if the pair falls below 1.4541.

Expiry time: 20:00 GMT

Disclaimer: The article is written for informative purposes only and it is not financial advice. The author does not have any position in the currency pairs mentioned, and no plans to initiate a position. He wrote the article himself and expressed his own opinions. He has no business nor personal relationships with any mentioned government entities or stocks. Readers should not treat any opinion expressed by the author as a specific inducement to make a particular trade or follow a particular strategy, but only as an expression of his opinion.

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