The British national GDP was reported at -0.4% (MoM) or +1.3% (YoY). Manufacturing fell to 3.9%, that had the strongest impact. Production was released at -2.7%.
Picture 1. British GDP
The trade balance in April was released at -12.11B that slightly better than the forecast (-13,10B) but we still see the deficit. On Tuesday economists are expecting the release of the Unemployment rate for April.
As a result, the British pound fell against the Swiss currency 300 points.
On Thursday, the Swiss national bank is going to make a decision about the interest rate. Economists expect that SNB will leave the interest rate at the level of -0.75%. Investors will be paying close attention to this press conference.
Now let’s look at the technical analysis.
On daily time frame, we see that the GBP is trying its support level at 1.26000. We see that there is a possibility of reversal. If GBP/CHF breaks the 9-EMA upward at the approximate level of 1.26200 it is possible that the pound will continue to rise. The next target would be 1,27000.
The MACD lines are approaching each other. The Parabolic SAR has also reversed.
Picture 2. GBP/CHF. 1D TF