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GBP/USD drops to hourly 50-MA on firmer USD

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 8, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Mumbai) - The cable met fresh supply near 1.4650 region and dropped sharply towards during the late-Asian trades, and now prints fresh session lows ahead of Europe open.

    GBP/USD sold-off on stronger USD

    The GBP/USD pair trades modestly flat at fresh session lows of 1.4613, on its way to test 1.46 barrier yet again. The cable’s recovery from 1.4530 region lost steam near the mid-point of the 1.46 handle and the GBP bears fought back control on the back of renewed strength in the greenback across the board, as China stock rebound boosted the risk-on trades.

    However, the downside remains capped in the GBP/USD pair as the prices continue to find support from the solid recovery in oil prices. The US oil jumps +2.28% while the Brent one rallies +2.52%.

    Focus now turns towards the only macro release from the UK docket, the trade balance, ahead of the highly influential non-farm payrolls from the US lined up for release in the NY session.

    GBP/USD Levels to consider


    The pair has an immediate resistance at 1.4651/61 (5-DMA/ 1h 50-SMA), above which 1.4683/1.4700 (Jan 6 High/ round number) would be tested. On the flip side, support is seen at 1.4600 (round number) below which it could extend losses to 1.4583 (daily S3).
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