GBP/USD a week ahead

The talk of a Brexit continues to impact the GBP/USD. The pair now consolidates that could see some dramatic moves in the week ahead.

The technical indicators are showing some interesting signals as the RSI Oscillator remains relatively flat, near oversold territory, despite the recent price declines. There is some divergence between the indicator and price action that could be indicating a reversal of the short term trend.
Traders have to consider for the entry of a long position above the key 1.4170 resistance level. Alternatively, a break below the 1.40 handle would indicate a sharp push towards the bottom of the channel is likely. However, be aware of any short side move as the Risk/Reward ratio is not advantageous.

The pair  is likely to wait upon the UK Manufacturing Production results before making a strong move. However, given the recent collapse in the pair’s value, the downside might be relatively limited. The most likely scenario is a sideways consolidation at the current level .