6 Sep 2013
GBP/USD posts key bearish reversal Thursday; will it stick?
FXstreet.com (Barcelona) - Thursday, the GBP/USD started higher and then finished lower and below the midpoint of Wednesday’s range – making it a key bearish reversal. Considering the recent strength, it will require some downside follow through to confirm the reversal, though.
GBP/USD reversed lower once the BOE news broke and US data started to flow
Traders took the rate decision and commentary out of the Bank of England and stumbled around for a few minutes. However, once the US data flow started and it became obvious the tone there was going to be bullish, the GBP/USD corrected sharply lower – enough so that a technical key bearish reversal occurred. Typically, with those types of reversals, more evidence is needed before the issue can be declared over.
Friday, GBP/USD traders will get plenty more data to digest including British Consumer Inflation Expectations, British Industrial Production, British Manufacturing Production, British Trade Balance data and the monthly US Employment Report.
Technical outlook for GBP/USD
Technicians now say the key resistance level to monitor in the short-term for GBP/USD is 1.5623. A close above that level may lead to a test of the recent highs at 1.5717. Short-term support for the cross comes in at the horizontal line support at 1.5530 and is followed by last Friday’s pivot of 1.5461.
GBP/USD reversed lower once the BOE news broke and US data started to flow
Traders took the rate decision and commentary out of the Bank of England and stumbled around for a few minutes. However, once the US data flow started and it became obvious the tone there was going to be bullish, the GBP/USD corrected sharply lower – enough so that a technical key bearish reversal occurred. Typically, with those types of reversals, more evidence is needed before the issue can be declared over.
Friday, GBP/USD traders will get plenty more data to digest including British Consumer Inflation Expectations, British Industrial Production, British Manufacturing Production, British Trade Balance data and the monthly US Employment Report.
Technical outlook for GBP/USD
Technicians now say the key resistance level to monitor in the short-term for GBP/USD is 1.5623. A close above that level may lead to a test of the recent highs at 1.5717. Short-term support for the cross comes in at the horizontal line support at 1.5530 and is followed by last Friday’s pivot of 1.5461.