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GBP/USD hovers around Jan 21 low

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Mar 3, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    The GBP/USD did bounced off 23.6% Fibo support despite weak UK services PMI data, but is having a tough time sustaining/extending gains above Feb 21 low of 1.4079.

    Is weak UK data capping gains?

    The recovery from the post UK data low of 1.4032 appears to have run out of steam at 1.4083 levels. Though the recovery is surprising, given the horribly weak UK services PMI release, the loss of momentum is not.

    It appears the bears are coming back as services PMI printing at lowest since April 2013 is a major roadblock in BOE’s plans to raise rates. The immediate focus now is on the US weekly jobless claims, which will be followed by a US ISM non-manufacturing PMI data.

    GBP/USD Technical Levels

    The immediate hurdle is seen at the daily high of 1.4106, which if taken out could see the spot test 1.4125 (Jan 20 low). A break higher would expose 1.4165 (23.6% of 1.5230-1.3835). On the lower side, 1.4032 (10-DMA + 23.6% of Feb high-low) remains a strong support. A break lower would expose major support levels seen at 1.40 and 1.3955 (hourly 100-MA).
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