Pound Sterling Price News and Forecast: GBP/USD consolidates at one-month lows under 1.3400
|GBP/USD consolidates at one-month lows under 1.3400 as hawkish Fed, strong GDP data keep dollar buoyant
GBP/USD fell to one-month lows on Thursday underneath the 1.3400 level after slumping below resistance in the 1.3450 area earlier in the session, weighed by a buoyant dollar in wake of Wednesday’s hawkish Fed meeting and strong US GDP data. The pair is now consolidating in the 1.3380 area, practically bang on a level of resistance turned support from back in mid-December, where it trades lower by about 0.6% on the day. Those losses, though extensive, are modest compared to many of sterling’s G10 peers; AUD is down 1.2%, SEK and NZD are down 1.1%, EUR and CHF are down around 0.9%. Sterling’s performance puts it roughly in line with that of the loonie and yen, both of which are also down about 0.6% on the day versus the buck. Read more...
GBP/USD Forecast: Next bearish target aligns at 1.3350
GBP/USD has managed to recover modestly from the monthly low it set at 1.3405 earlier in the session but it's not out of the woods yet. In case buyers fail to defend 1.3400, the pair is likely to extend its slide toward 1.3350. The FOMC Chairman Powell's hawkish tone during the press conference on Wednesday, despite the Fed's decision to leave policy settings unchanged, allowed the dollar to gather strength against its major rivals. Read more...
Majors technical outlook
Since shaking hands with the lower side of the 200-day simple moving average (currently circling $1.3719), GBP/USD shed nearly 3.0 percent (or nearly 400 pips). Support is nearby at $1.3355, with a break triggering additional bearish flow, perhaps setting the stage for a test of Quasimodo support at $1.3119. Trend on this timeframe remains biased to the downside, with the relative strength index (RSI) also recently nudging beneath the 50.00 centreline, signalling negative momentum (average losses exceeding average gains). Read more...
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