GBP/USD dropping before NA open (London) - GBP/USD had bounced from the yearly lows on Tuesday and continued through to breach 1.4900 in European markets today.

GBP/USD reached 1.4924 and had held within range above the handle until moments before the NA open. The pair will also be tested again tonight, however, when we will hear the FOMC minutes and moreover, more about what was meant in Bernanke’s statements re tapering. It is those statements and his ‘openness’, which the current confused market place wants clarified. Bernanke will give a speech tonight, and we will be listening carefully for some forward guidance there.

GBP/USD resistance 1.5015

GBP/USD readings are bearish in the long term, with head and shoulders and MA’s all offering a negative bias. However, the market might expect a larger recovery before resuming the downtrend, and Karen Jones, Chief Analyst at Commerzbank said “We note the divergence of the 240 minute RSI and currently we would continue to allow for a small rebound. We suspect that intraday rallies will struggle to clear the May lows at 1.5015 and the accelerated downtrend at 1.5139 should remain capped by 1.5300/25 and while capped here, the market will remain directly offered. 2010 low.”