GBP/USD analysis: Sterling still among the less attractive
|GBP/USD Current Price: 1.2727
- Business investment trends still negative in the UK, according to Brexit Broadbent.
- EU Parliamentary elections adding weigh on vulnerable Sterling.
The GBP/USD pair started the day correcting higher, but the Sterling was unable to hold on to gains, finishing the day unchanged at around 1.2720. There were no new updates on the Brexit´s disruptive situation, although it kept weighing on Sterling ahead of European Parliamentary elections later this week. Tories and Labours have been working on attracting voters, rather looking to replace PM May rather than solve the Brexit stalemate situation. However, the latest polls in the kingdom show that three in five voters are disappointed with politics, with the two parties running neck and neck, painting a more gloomy future for the UK and the GBP. On Monday, BOE's Deputy Governor Broadbent hit the wires, although the only relevant remark he made is that UK business investment trends are still negative, a result of Brexit uncertainty. This Tuesday, the only macroeconomic even scheduled is the CBI Industrial Trends Survey on Orders for May, seen unchanged at -5.
Technically, the consolidative stage has helped intraday technical readings to correct part of the extreme oversold conditions seen these last few days. Nevertheless, the 4 hours chart for the GBP/USD pair shows that the RSI was unable to surpass the 30 level, now heading back south at around 25, while the Momentum indicator lost directional strength, holding flat well into negative ground. The 20 SMA in the mentioned chart has extended its slide, maintaining a strong bearish slope currently at around 1.2785, while the 200 EMA also turned lower, although some 300 pips above the current level. The risk of further declines will become more evident on a break below 1.2705 the immediate support.
Support levels: 1.2705 1.2670 1.2630
Resistance levels: 1.2750 1.2785 1.2820
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.