GBPUSD FOREX EXCHANGE decline from 1.3267 extended to as low as 1.2830 last week. Initial bias stays on the downside this week for 1.2588 key near term support. We’re favoring the case that correction from 1.1946 is completed at 1.3267. Decisive break of 1.2588 will confirm our view and target a test on 1.1946 low. On the upside, above 1.2915 minor resistance will turn intraday bias neutral first. But near term outlook will remains cautiously bearish as long as 1.3030 resistance holds.
In the bigger picture, overall, price actions from 1.1946 medium term low are seen as a corrective pattern. While further rise cannot be ruled out, larger outlook remains bearish as long as 1.3444 key resistance holds. Down trend from 1.7190 (2014 high) is expected to resume later after the correction completes. And break of 1.2588 will indicate that such down trend is resuming.
The average earnings index data and the retail sales data from the UK came in stronger than what was expected but that was not enough to lift the pound. The selling in the pair was clear for everyone to see and the pair continued to get weaker during the course of the week even though the dollar was on the backfoot following the FOMC meeting minutes. The pair rolled downwards and there were a couple of attempts to break through the important support region at 1.2860 but so far, the support region has managed to hold on.
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