GBP/USD
dropped below the 1.4300 handle after having posted a fresh multi-month high at
1.4375 . The macro agenra today served disappointing UK earnings numbers which contributed
to the suffering of the Sterling.
During the last two weeks the Cable performed excellent and rallied from 1.3965
to 1.4375 (the intraday high) and during this period we witnessed higher
highs and higher lows.
Technically speaking the short term outlook remain neutral to bearish. On the
four hour time frame the price is developing above its moving averages, having
bullish 20-day SMA and slow turning to flat 100-day and 200-day SMAs. RSI has
eased its downward slope and currently is located at 58, having a break to
look for direction. Stochastic is showing strong bearish momentum and is nearing
oversold territory.
As seen on the same chart the pair continues falling and surpassed last week’s
high at 1.4344 which brings a signal for deeper pullback.
On the other hand, dips could be limited as Sterling remains backed up by the
expectations of BoE’s rate hike on policy meeting next month.
However the pullback could meet strong support at 1.4244 (late March’s highs)
and ex long term resistance that should keep intact overall bulls.
Tomorrow will bring the next key event for the Cable with the release of UK
inflation data which could provide fresh direction signal.
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