“Market volatility won’t stop more rate hikes” said the new Fed chair
Powell in his first testimonial statement. Of course this sentence boosted
the greenback and further on was concreted by the upbeat US consumer
confidence data. On the other hand the Sterling is suffering and came under
huge selling pressure on the latest episode of Brexit drama and significant
differences on the transition deal.
Amid these fundamentals the GBP/USD dropped to 1.3857 but
succeeded to regain the 1.3900 handle with current market price around the
23.6%. Fibonacci
retracement of the February bearish run at 1.3914.
Technically speaking the short term outlook for
the Cable remains neutral to bearish. On the four hour time frame the price is
developing below the flat 20-day SMA, coinciding with the 38.2%
of same Fibo at 1.3960. RSI is quite undecided and is staying flat around 43.
Stochastic is showing strong bearish momentum and has entered into extreme
negative area.
According to above readings the bulls will remain behind the
curtains until fighting back first the 1.3900 level and then 1.3960. The
downside is currently supported initially by 1.3890 and lower at 1.3850.
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