GBP/USD analysis: at the lower end of its range, bearish
GBP/USD Current price: 1.3469
- Future trade-deal between the EU and the UK back to the spotlight.
- UK inflation and retail sales to be out this week, expected to bring some hope for Pound.
The GBP/USD pair remained under pressure, ending the week near the 1.3450 4-month low established last Wednesday, with the Pound undermined by resurgent concerns around the EU-UK future trade relationship post Brexit, as the clock keeps ticking and no deal has been so far reached. There were no relevant UK macroeconomic releases these last days but this one the kingdom will offer April inflation figures next Wednesday, and Retail Sales data on Thursday, with inflation seen stabilizing above 2.0% and sales increasing from the previous slump, which may help the Pound bounce. The pair has been lacking direction ever since May started, trading in a well-defined 150 pips´ range, but these last few days the pair has been pressuring the lower end of such range, keeping the risk skewed to the downside. Technically the daily chart shows that the 20 DMA heads south almost vertically some 100 pips above the current level, and also that the Momentum indicator heads nowhere right below its mid-line, while the RSI indicator heads lower at 26, having spent almost a month in oversold territory. In the 4 hours chart, the pair presents a neutral-to-bearish stance, holding below a modestly bearish 20 SMA, and with technical indicators heading south, the Momentum within neutral levels, but the RSI gaining downward traction, now around 40, favoring additional declines ahead.
Support levels: 1.3450 1.3410 1.3370
Resistance levels: 1.3490 1.3520 1.3570
Author
Valeria Bednarik
FXStreet
Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.
