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GBP/USD recovery post-PMI falters, slips back to1.4200

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Apr 5, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    The GBP/USD pair met fresh supply on its recovery from UK PMI induced losses, dragging the rate lower in a bid to retest 1.42 handle.

    GBP/USD attacks 1.4200

    The GBP/USD pair drops -0.40% to fresh session lows of 1.4204, stalling the recovery near 1.4240 levels. The cable came under renewed selling pressure and dives deeper in the red as the US dollar regained lost footing against its major peers, with the USD index jumping 0.20% higher at 94.78 levels, ending a six-day losing streak.

    Moreover, markets absorb mixed UK services PMI report, with the services sector activity coming in below estimates, but a tad stronger than the previous reading. The UK services sector picked up to 53.7 in March, following February's lowest reading since April 2013, although missed estimates of a 53.9 reading.

    Looking ahead, the cable remains is expected to remain under pressure as the poor broader market sentiment will continue to weigh, while the upcoming US data may offer some respite to the bulls.

    GBP/USD Levels to consider

    The pair has an immediate resistance at 1.4250/57 (round number/ 5 &10-DMA), above which 1.4300 (psychological levels) would be tested. On the flip side, support is seen at 1.4171 (Apr1 Low) below that at 1.4100 (key support).
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