GBP has overall been the strongest contender for the dollar since the world’s commodity currency moved higher across the board on a risk-off play on signs that a rate hike in the US economy will come sooner. Today, the pair is trading lower on the European and London open since seeing levels above 1.5500 over yesterday nights activity in NY and Asia. The pair has found a base at 1.5480 in a relatively quiet morning session without any major data releases on the stock pile. For the UK economy only, we have Public Sector Net Borrowing for May £13.750B vrs previous £8.035B at 8.30GMT. While not painting a very good picture for the economy, the risk is already priced into the pound.
GBP/USD has a bearish bias
Karen Jones of Commerzbank said that GBP/USD continues to weigh on the downside - the daily RSI has diverged, and there is a 13 count on the daily and the TD perfected set up that all suggest that the market has topped at 1.5752. “This move lower is poised to encounter the 55 day ma at 1.5377, failure here is needed to signal a slide to the support line at 1.5063.”
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