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The pound has taken a dip on Tuesday, as the pair trades in the mid-1.65 range in the North American session. The markets are trying to keep up with fast-moving events in the Ukraine, as Russia moves ahead with its annexation of Crimea and the EU and the US promise further sanctions. In the US, Building Permits beat the estimate, while Core CPI met market expectations. In the sole UK event on the schedule, BOE Governor Mark Carney will speak at an event in London.

Events are moving quickly in the Ukrainian crisis. Voters in Crimea voted overwhelmingly to join Russia in Sunday's referendum, and the Russian and Crimean parliaments have signed a treaty of accession, paving the way for Russia to annex the region. The EU and US have strongly condemned the move and responded with targeted sanctions, freezing assets of several high-ranking Russian officials. Additional sanctions are expected, possibly as early as this week.

In the US, Building Permits jumped to 1.02 million, a four-month high. This was the indicator's highest level since October. US Core CPI came in with a weak gain of 0.1%, for the third straight month. Although this matched the estimate, the paltry gain points to persistently low inflation in the US, indicative of an underperforming economy. On Wednesday, the spotlight shifts over to Federal Reserve, which is expected to announce a $10 billion taper of QE, the third installment since the Fed commenced winding up the asset-purchase scheme in December.

GBP/USD for Tuesday, March 18, 2014

Forex Rate Graph 21/1/13

GBP/USD March 18 at 16:30 GMT

GBP/USD 1.6565 H: 1.6647 L: 1.6546

GBP/USD Technical

S3 S2 S1 R1 R2 R3
1.6329 1.6416 1.6549 1.6705 1.6765 1.6896

  • GBP/USD has lost ground in Tuesday trade.
  • 1.6549 has weakened as a support line, with the pound losing ground. This is followed by stronger support at 1.6416.
  • 1.6705 is the first line of resistance. Next, there is resistance at 1.6765.
  • Current range: 1.6549 to 1.6705.

Further levels in both directions:

  • Below: 1.6549, 1.6416, 1.6329 and 1.6236
  • Above: 1.6705, 1.6765, 1.6896, 1.6964 and 1.7087

OANDA's Open Positions Ratio

GBP/USD ratio is posting gains in short positions on Tuesday. This is consistent with what we are seeing from the pair, as the pound has given up ground to the US dollar. A large majority of the open positions in the GBP/USD ratio are short, indicative of a trader bias towards the dollar continuing to move higher.

The pound has weakened on Tuesday, as nervous investors head for the safe-haven dollar. The pair is stable in the North American session.

GBP/USD Fundamentals

  • 12:30 US Building Permits. Estimate 0.97M. Actual 1.02M.
  • 12:30 US Core CPI. Estimate 0.1%. Actual 0.1%.
  • 12:30 US CPI. Estimate 0.1%. Actual 0.1%.
  • 12:30 US Housing Starts. Estimate 0.92M. Actual 0.91M.
  • 13:00 US TIC Long-Term Purchases. Estimate 23.4B. Actual 7.3B.
  • 17:45 BOE Governor Mark Carney Speaks.

*Key releases are highlighted in bold

*All release times are GMT

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Source: GBP/USD - Pound Lower As Nervous Markets Follow Ukrainian Saga