GBP/USD extends slide and approaches 1.3800
|- US dollar holds onto modest daily gains across the board.
- GBP/USD heads for the lowest daily close in two weeks.
The GBP/USD dropped further after the beginning of the American session and printed a fresh daily low at 1.3821. Cable is hovering around 1.3830 and it has erased Wednesday’s gains.
The combination of a stronger US dollar and also a weaker pound pushed GBP/USD further to the downside. The greenback gained momentum after the release of US economic data.
Inflation data came in above expectations, with the IPP reading for July and jobless claims dropped in line with expectations. The DXY is up 0.11%, at 93.00. The 10-year yield initially rose boosting the dollar and then pulled back to 1.35%. Equity prices in Wall Street are mixed on a session with low volatility.
Looking bearish with some support
From a technical perspective, the outlook for GBP/USD favors the downside for the moment. The pair is testing the 20-day moving average. A daily close clearly under 1.3830 would favor an extension of current down move. The next strong support stands at 1.3800.
On the upside, a recovery above 1.3890 should clear the way to more gains for the pound and improve the outlook. A short-term downtrend line stands at 1.3875.
Technical levels
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.