The UK currency extended the upside last week, breaking above 1.4250. The pair holds in a bullish channel since late February and has potential for more recovery next week. Break above 1.4300 will open the way to 1.4350 (61.8% Fibo from the recent decline) and 1.4400 (channel resistance). Support is seen at 1.4250 and 1.4100.
From the fundamental viewpoint, we expect the dovish Fed to support the cable this week. The US central bank is expected to underline the increased external risks for the economy on Wednesday. As for the UK economic calendar, watch the labor market figures on Wednesday and the Bank of England meeting on Thursday.
