Pound advances vs. dollar on upbeat UK industrial output report

UK industrial output rises in April fxcommentThe pound soared for a third straight session on Wednesday against the U.S. dollar after a report showing U.K. industrial output rose more than forecast in April.

U.K. industrial production edged up 0.4 percent from March, coming above economists’ estimates of 0.1 percent increase.

However, gains in the pound were limited as factory output for the same month plunged 0.4 percent, while analysts predicted a 0.1 percent advance.

Most probably, the pound took advantage of the drop in the dollar versus a basket of major currencies as U.S. officials expressed their concern about the strong dollar’s effect on the U.S. economy.

The dollar index dropped for third session in a row on Wednesday to hover around 94.66, compared to the session’s opening at 95.10.

As of 08: 53 GMT, the pound slipped sharply against the yen to trade around 189.31, while inched down versus the euro to trade at 0.7333.

Later in the day, BoE Governor Mark Carney will deliver his annual Mansion House speech.

GBPUSD

The pair rose to trade around 1.5434, above today’s Pivot Point located at 1.5342, but faced resistance near the session’s high at 1.5470.

The GBPUSD found support from both SMA 7 and SMA 15, as depicted on the daily chart, where it gained some momentum as the RSI 14 rose above the 50-center line. In case the pair resumed its advance, it may face resistance at 1.5600.

Pound advances vs. dollar on upbeat UK industrial output report

Ahmed Mamdouh

Ahmed Mamdouh, Co-Founder and Head of English Fundamental Analysis at FXComment.com, with 7 years of experience in the financial markets. Mamdouh holds a Master’s Degree in Economics from The American University in Cairo and a Bachelor Degree in Economics from The Faculty of Economics and Political Science, Cairo University.

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