3 Dec 2014
GBP/USD returns to sub-1.5700
FXStreet (Edinburgh) - The sterling upside is now losing momentum, pushing GBP/USD to trade back below the 1.5700 mark on Wednesday.
GBP/USD down from 1.5720
After climbing as high as 1.5720 following the auspicious result from the Services PMI in the British economy and the Autumn Forecast Statement, GBP lost vigour and initiated a correction lower to the current area of 1.5685/80. Ahead in the week, the BoE will hold its MPC meeting tomorrow, although market consensus expects the ‘Old Lady’ to leave both the refi rate and the asset purchase facility unchanged at 0.5% and £375 billion, respectively. Karen Jones, Head of FICC Technical Analysis at Commerzbank, commented the pair “completely ignored its key day reversal from the day prior and again sold off. The 1.5595/92 lows remain in focus. These are regarded as the break down point to 1.5320, the 78.6% retracement of the move from 2013”.
GBP/USD levels to watch
At the moment the pair is up 0.30% at 1.5687 with the next resistance at 1.5699 (10-d MA) ahead of 1.5719 (high Dec.3) and then 1.5740 (21-d MA). On the flip side, a breakdown of 1.5619 (low Dec.3) would open the door to 1.5585 (2014 low Dec.1) and finally 1.5564 (low Sep.6 2013).
GBP/USD down from 1.5720
After climbing as high as 1.5720 following the auspicious result from the Services PMI in the British economy and the Autumn Forecast Statement, GBP lost vigour and initiated a correction lower to the current area of 1.5685/80. Ahead in the week, the BoE will hold its MPC meeting tomorrow, although market consensus expects the ‘Old Lady’ to leave both the refi rate and the asset purchase facility unchanged at 0.5% and £375 billion, respectively. Karen Jones, Head of FICC Technical Analysis at Commerzbank, commented the pair “completely ignored its key day reversal from the day prior and again sold off. The 1.5595/92 lows remain in focus. These are regarded as the break down point to 1.5320, the 78.6% retracement of the move from 2013”.
GBP/USD levels to watch
At the moment the pair is up 0.30% at 1.5687 with the next resistance at 1.5699 (10-d MA) ahead of 1.5719 (high Dec.3) and then 1.5740 (21-d MA). On the flip side, a breakdown of 1.5619 (low Dec.3) would open the door to 1.5585 (2014 low Dec.1) and finally 1.5564 (low Sep.6 2013).