GBP/USD jumped to daily highs after US data

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 20, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    FXStreet (Mumbai) - The oversold GBP/USD pair neared 1.42 handle after the US housing starts unexpectedly fell in December, while the economy fell into deflation.

    Oversold GBP poised for a recovery?

    Sterling has reacted positive to a weaker-than-expected US data. The currency pair is oversold on the technical charts due to a 1000 pip fall in one month. Furthermore, the UK unemployment rate dipped in three months to November.

    Hence, the currency pair appears poised for a recovery given the US data has disappointed market expectations. As of now the pair is trading at 1.4180 after having clocked a daily high of 1.4196.

    GBP/USD Technical Levels

    The immediate resistance is seen at 1.4214 (hourly 50-MA), under which the pair could test 1.4274 (hourly 100-MA). On the other hand, a break below 1.4125 (daily low) would open doors for a drop 1.41 handle.
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