GBP/USD extends bullish momentum, supply 1.5250 tested

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Nov 19, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    FXStreet (Bali) - GBP/USD continues to run higher in early Tokyo, with offers at the critical juncture of 1.5240 being absorbed, as the pair enters what should be considered as a 'battle royal' zone between buyers and sellers, with sizeable stop bu orders north of 1.5260/70.

    GBP/USD launches attack towards sellers' stronghold

    It will be interesting to monitor the price action during the next few hours in Asia, to gauge whether the market, despite the iliquid time of the day in this particular asset class, holds at these hefty highs - considering prospects for a Dec rate hike and options pricing - or is quickly rejected.

    UK retail sales expected to turn negative

    Later in the UK, retail sales will be released, and with expectations for a -0.4% decline in October, market participants looking to position for a downbeat report may find current prices exceptionally attractive. That said, the broad-based USD weakness post the FOMC minutes should be a warning sign, with EUR/USD finding it hard to make new lows.

    GBP/USD technicals

    According to Valeria Bednarik, Chief Analyst at FXStreet: "The technical stance is neutral in the short term, although a tepid positive tone is surging in the 1 hour chart, as the price has held above a horizontal 20 SMA while the technical indicators head higher well above their mid-lines. In the 4 hours chart, the 20 SMA continues lacking directional strength around the 38.2% retracement of the latest weekly decline around 1.5210, while the technical indicators are slowly turning higher above their mid-lines, lacking enough momentum to confirm further gains."
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