GBP/USD collapses to 1.4420 ahead of Carney

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 12, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    FXStreet (Edinburgh) - The selling pressure remains unabated around the sterling today, dragging GBP/USD to the proximity of 1.4420, or fresh multi-year lows.

    GBP/USD weaker on data, yield spread

    The yields spread differential between the UK Gilts and US-T, mainly in the short end of the curve, keep favouring the latter and thus giving extra legs to the dollar, exacerbating the pair’s decline.

    In addition, the sterling is deriving further weakness from November’s poor Industrial and Manufacturing Production figures, adding to the recent deterioration of economic prospects for the UK economy.

    GBP/USD important levels

    The pair is now losing 0.82% at 1.4423 and a breakdown of 1.4400 (psychological level) would expose 1.4346 (low Jun.8 2010) and then 1.4229 (2010 low May 20). On the flip side, the next resistance aligns at 1.4947 (high Dec.24) ahead of 1.5015 (55-day sma) and finally 1.5158 (100-day sma).
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