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Oversold GBP/USD rises to 1.43, ignores weak retail sales & cheers PSNB figure

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 22, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Mumbai) - The oversold GBP/USD found a reason to extend the corrective rally to 1.43 levels after the data showed the UK public sector net borrowing dropped sharply in December.

    Retail sales ignored

    The traders ignored the 1% decline in the UK retail sales figure. The annualized number was also well below the estimates. However, a minor drop to 1.4252 was quickly reversed after another data showed the public sector net borrowing dropped to GBP 6.871 billion. The actual figure was way below the estimated drop to GBP 10.35 billion.

    The move to 1.43 is surprising given the retail sales printed weak. However, the traders may have found a reason to take profits on GBP shorts following an upbeat net borrowing figure.

    GBP/USD Technical Levels

    The pair currently trades around 1.4290. The immediate resistance is seen at 1.4301 (hourly 200-MA), above which the pair could rise to 1.4351 (23.6% of 1.5230-1.4079). On the other hand, a break below 1.4209 (hourly 100-MA) could see the pair fall back to 1.4129 (Jan 19 low).
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