GBP/USD bounces-off lows near 1.4420

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 13, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    FXStreet (Mumbai) - The cable finally broke the consolidation phase seen since mid-Asia and edged lower in the European morning, now testing daily lows posted previously at 1.4425.

    GBP/USD stalls recovery and resumes the drop

    The GBP/USD pair trades -0.10% lower at 1.4434, retreating quickly from fresh session lows of 1.4419 reached last minutes. The cable erased gains and returned to the red zone, as the greenback regained lost momentum against its major competitors and benefits from the extension of risk-on rally seen in the European stocks. The US dollar index jumps to session tops at 99.35, recording a 0.30% gain on the day.

    The GBP/USD pair looked past BOE Carney’s defensive comments on the UK economy and now tracks the USD moves in absence of economic news from the UK docket today. While the latest UK weak industrial numbers continue to weigh on the investors mind, keeping the GBP undermined against the greenback.

    Meanwhile, on Tuesday, BOE Governor Mark Carney noted that the economic recovery in the UK is “not a debt-fuelled recovery", the UK is now in a "more normal risk environment."

    GBP/USD Levels to consider

    The pair has an immediate resistance at 1.4492/96 (5-DMA/ 1h 50-SMA), above which 1.4536/48 (1h 100-SMA/ daily R1) would be tested. On the flip side, support is seen at 1.4400 (psychological levels) below which it could extend losses to towards 1.4350 (Jan 12 Low).
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