The GBP/USD dropped significantly today and has touched new lows, I’ve said in the previous analysis that the pair could drop on the short term as the buyers look exhausted. Price has found temporary resistance and now is seeking for support, could find one very soon, remains to see how will react when will hit this downside obstacle.

The dollar has dragged the price down as the USDX has managed to resume the bullish momentum and to reach new highs on the short term. The USDX has edged higher in the last few hours and has touched the 99.89 level, now has slipped lower, but maintains a bullish perspective, a further increase will send the greenback much higher versus all its rivals.

The Cable has dropped sharply as the UK’s data have come in worse than expected, the Manufacturing Production dropped by 0.6% in March, more versus the 0.2% estimate, has dropped further after the 0.3% drop in the previous reporting period, while the Industrial Production has dropped by 0.5%, more versus the 0.4% estimate, the indicator continues to stay inside the negative territory. Moreover the Construction Output decreased by 0.7% in March, even if the traders have expected to see a 0.3% growth, while the Goods Trade Balance dropped further, from -11.4B to -13.4B, more versus the -11.7B estimate.

The BOE has maintained the Office Bank Rate steady at 0.25%, matching expectations, the MPC members have voted by a majority of 7 to 1, even if the economists have expected an unanimously vote for this decision. Moreover the Asset Purchase Facility remains steady at 435B, matching expectations.

Price has dropped significantly and now is very close to hit the lower median line of the ascending pitchfork, I’ve said that the rate could come to retest this level after the failure to reach and retest the 50% Fibonacci line (ascending dotted line). The major upside target remains at the upper median line (UML) of the major descending pitchfork, could still reach this level if will stay inside the ascending pitchfork’s body and above the 1.2798 static support (resistance has turned into support).