GBP/USD fades spike above 1.34, eyes 38.2% Fib support
|- GBP/USD faded spike to 1.3431.
- Short-term technicals favor the downside.
The GBP/USD pair failed to take out the 10-day MA level of 1.3430 and fell back below 1.3380 as Irish issue lingers and investors look forward to this week's Fed and BoE meeting.
Kathy Lien from BK Asset Management writes, "the real issue though continues to be the border with Ireland which there was very little detail other than a pledge to provide specific solutions to address the unique situation of Ireland and a promise that in the absence of a Irish border deal, the UK will maintain full alignment with the single market and customs union."
Focus on Fed
The USD could remain bid as the Fed is widely expected to hike rates by 25 basis points on Wednesday. However, there is a risk that the greenback could take a hit following the rate hike (sell the fact). Also, the dollar could take a beating of the Fed scales back its hawkish interest rate forward guidance.
UK data heavy week, eyes BOE meeting
Investors look forward to a string of UK data - CPI, labor data & wage growth numbers, and retail sales - due later this week. Meanwhile, the Bank of England (BoE) may largely endorse a wait-and-see approach ahead of 2018.
GBP/USD Technical Levels
The spot was last seen trading around 1.3375. A daily close below 1.3354 (38.2% Fib R of Nov. 3 low - Nov. 30 high) would open up downside towards 1.3294 (50% Fib R) and 1.3243 (50-day MA). On the higher side, breach of resistance at 1.34 (zero levels) could yield 1.3430 (10-day MA) and 1.3440 (4-hour 50-MA).
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.