6 Jan 2015
GBP/USD: Bear trend targets 1.50 - FXStreet
FXStreet (Bali) - GBP/USD's risk of a break lower continues to be fairly high, notes Valeria Bednarik, Chief Analyst at FXStreet, adding that a sell-off towards the 1.50 critical level could be in store this week.
Key Quotes
"Highflying dollar drove the British pound down to 1.5202 this Monday, with the pair also weighted by worse than expected UK Construction data, down to its lowest since July 2013. The GBP/USD pair reached then a long term ascendant trend line coming from 1.3501 at 1.5200, bouncing some 50 pips from the level, but maintaining the overall bearish tone in the short term."
"The 1 hour chart shows that the price stands below a flat 20 SMA as indicators recover from extreme oversold levels, but remain below their midlines. In the 4 hours chart indicators aim higher but remain in oversold territory, giving little support to an upward corrective movement. The tested trend line is a major long term support, and should come as no surprise the pair bounced from it. However, the risk of a break below is high, with the pair then exposed to a rally towards the 1.50 critical level."
Key Quotes
"Highflying dollar drove the British pound down to 1.5202 this Monday, with the pair also weighted by worse than expected UK Construction data, down to its lowest since July 2013. The GBP/USD pair reached then a long term ascendant trend line coming from 1.3501 at 1.5200, bouncing some 50 pips from the level, but maintaining the overall bearish tone in the short term."
"The 1 hour chart shows that the price stands below a flat 20 SMA as indicators recover from extreme oversold levels, but remain below their midlines. In the 4 hours chart indicators aim higher but remain in oversold territory, giving little support to an upward corrective movement. The tested trend line is a major long term support, and should come as no surprise the pair bounced from it. However, the risk of a break below is high, with the pair then exposed to a rally towards the 1.50 critical level."