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GBP/USD drops below 5-DMA

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 26, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    FXStreet (Mumbai) - The GBP/USD pair dropped in Asia and and extended losses in early Europe to trade below its 5-DMA located at 1.4215 levels.

    Hovers around 1.42

    The strengthening risk-off tone and the resulting demand for the safe haven US treasuries has pushed the cable to near 1.42 levels. Oil prices dipped in Asia, while Chinese stocks weakened. Consequently, Sterling and other currencies weakened.

    The pair remains at the mercy of the sentiment in the European markets; given the economic calendar in Europe is empty.

    GBP/USD Technical Levels

    The immediate support is seen at 1.4129 (Jan 19 low), under which the spot could re-test the recent cyclical low of 1.4079. A break lower would open doors for a test of 1.40 handle. On the other hand, a break above 1.4258 (10-DMA) could see the pair test 1.4309 (previous day’s high), which if taken out shall open doors for 1.4351 (23.6% of 1.5230-1.4079).
    For more information, read our latest forex news.

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