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GBP/USD struggling to hold 1.43 handle

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 25, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    FXStreet (Mumbai) - The cable was one of the best performers in Asia and witnessed a 60-pips rally from 1.4250 region and now struggles above 1.43 handle.

    GBP/USD faces stiff resistance near 1.4310

    The GBP/USD pair trades 0.28% higher at 1.4304, hovering close to session highs reached at 1.4310 in last hours. After bottoming near 10-DMA at 1.4258, the major staged a solid corrective rally in Asia this Monday as risk-on wave extended, tracking the recovery in oil prices and global equities.

    The cable regained 1.43 handle and received double booster shot from the broad based US dollar weakness on one hand, while the demand for higher-yielding currencies amid persisting risk-on trades, lifted the bids for the GBP on the other.

    From a wider perspective, the cable remains under pressure on the back of dovish comments from BOE Governor Carney, massive UK account deficits, lower inflation outlook and uncertainties surrounding a probable Brexit.

    Markets now await the BOE Carney’s speech due tomorrow ahead of Wednesday’s FOMC statement due on Wednesday, while Thursday’s prelim GDP figures from the UK docket remains one of the key risk events for the GBP in the week ahead.

    GBP/USD Levels to consider

    The pair has an immediate resistance at 1.4325/41 (Jan 18 & 19 High), above which 1.4364 (Jan 22 High) would be tested. On the flip side, support is seen at 1.4289 (1h 200-SMA) below which it could extend losses to towards 1.4258/47 10 & 5-DMA).
    For more information, read our latest forex news.

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