GBP/USD Outlook: Bears consolidate above new 2-mth low after eventual break below key 200SMA support

Slobodan Drvenica Windsor Brokers

GBPUSD

Cable hit new two-month low at 1.2914 on Wednesday, in extension of previous day’s strong fall, mainly driven by rallying dollar and soured sentiment on no substantial changes in stalled Brexit talks.
Tuesday’s break and close below key supports provided by converging 200 / 100SMA’s at 1.2965/57 respectively (200SMA kept the downside attempts limited since 19 Feb) was strong bearish signal.
Bears eye key Fibo support at 1.2889 (50% retracement of 1.2397/1.3381 ascend), violation of which would risk extension towards next key level at 1.2773 (14 Feb trough / Fibo 61.8% of 1.2397/1.3381).
Meanwhile, deeply oversold stochastic suggest that bears may pause ahead of 1.2889 target and bounce, in positioning for fresh push lower.
Broken 200SMA (reinforced by formation of 5/200SMA bear-cross) should ideally cap upticks, but stronger recovery towards daily cloud base (1.3024) cannot be ruled out.

Res: 1.3008; 1.3024; 1.3034; 1.3059
Sup: 1.2975; 1.2966; 1.2960; 1.2916

Interested in GBPUSD technicals? Check out the key levels

1. R3 1.3087
2. R2 1.3053
3. R1 1.2995
PP 1.2961
1. S1 1.2902
2. S2 1.2868
3. S3 1.281

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

EUR/USD challenges 1.1800, two-week lows

EUR/USD remains on the defensive, extending its leg lower to the vicinity of the 1.1800 region, or two-week lows, on Tuesday. The move lower comes as the US Dollar gathers further traction ahead of key US data releases, inclusing the FOMC Minutes, on Wednesday.

GBP/USD looks weaker near 1.3500

GBP/USD adds to Monday’s pessimism and puts the 1.3500 support to the test on Tuesday. Cable’s marked pullback comes in response to extra gains in the Greenback while disappointing UK jobs data also collaborate with the offered bias around the British Pound.

Gold loses further momentum, approaches $4,800

Gold recedes to fresh two-week troughs around the $4,800 region per troy ounce on Tuesday. The precious metal builds on Monday’s downtick following a marked rebound in the US Dollar and mixed US Treasury yields across the board.

Crypto Today: Bitcoin, Ethereum, XRP upside looks limited amid deteriorating retail demand

The cryptocurrency market extends weakness with major coins including Bitcoin (BTC), Ethereum (ETH) and Ripple (XRP) trading in sideways price action at the time of writing on Tuesday.

UK jobs market weakens, bolstering rate cut hopes

In the UK, the latest jobs report made for difficult reading. Nonetheless, this represents yet another reminder for the Bank of England that they need to act swiftly given the collapse in inflation expected over the coming months.

Ripple slides to $1.45 as downside risks surge

Ripple edges lower at the time of writing on Tuesday, from the daily open of $1.48, as headwinds persist across the crypto market. A short-term support is emerging at $1.45, but a buildup of bearish positions could further weaken the derivatives market and prolong the correction.