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GBP/USD headed to Jan 2009 lows?

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 19, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Guatemala) - GBP/USD has continued on the hands of the bears and was changing hands well below the hourly 20 sma at 1.4244 as pressures mount in respect of the outlook for the UK economy. The currency has been unable to recover ever since the break of the 1.4553 trend line support earlier on in the month.

    The price is accelerating in momentum and there is let up for the pound on a number of fundamental counts. Bets have been set back in respect to timings of a rate hike from the BoE while the Fed is on a path to normalising interest rate sin the US which leaves the pound out of favour as investors flee UK assets in times of uncertainty.

    GBP/USD levels

    Technically, GBP/USD continues to grind lower and has reached 1.4291/29, the 78.6% retracement and the May 2010 low, as noted by Karen Jones, chief analyst at Commerzbanks. "This is a major support zone for the market, the daily RSI is oversold – the risk is it will hold the initial test, but given the strength of the recent sell off our conviction is low. The 1.4229 level is the last defense for the 1.3502 January 2009 low."
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