GBP/USD - Bearish continuation pattern confirmed, eyes UK services PMI


  • GBP/USD daily chart shows the bearish flag breakdown.
  • The immediate focus on the UK services PMI release.

GBP/USD closed below 100-day MA on Thursday, courtesy of the Bank of England's (BOE) dovish rate hike. The spot closed at 1.3058 and traded around 1.3070 in Asia.

Bearish continuation pattern

A downside break of the inverted or bearish flag pattern indicates the sell-off from Sep. 20 high of 1.3657 has resumed. As per the measured height method, the downside break of the flag has opened doors for 1.2440 levels.

Focus on the UK services PMI

UK services PMI, due at 09:30 GMT, is expected to show the pace of expansion in the service sector activity cooled slightly to 53.3 in October from the September reading of 653.6.

A better-than-expected UK services may help Cable trim post-BOE loses. On the other hand, a weaker-than-expected services PMI would add credence to BOE's dovish forward guidance and could yield a drop below 1.30 handle.

Later in the day, the US wage growth numbers, due at 18:00 GMT, could yield big moves in the USD pairs.

GBP/USD Technical Levels

FXStreet Chief Analyst Valeria Bednarik writes - "The pair's 4 hours chart supports further declines ahead, as technical indicators barely decelerated their downward momentum once reaching oversold readings, where they stand, after the price broke below all of its moving averages, also below  all of the Fibonacci that limited price action this last month."

Support levels: 1.3026 1.2985 1.2950

Resistance levels: 1.3075 1.3110 1.3150

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

Are you new to trading or have been trading for a while and you feel stuck?

Try with us!
Become Premium!
   

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD holds above 1.22 as the dollar slides across the board

EUR/USD has extended its gains and has topped 1.22, the highest since February. The safe-haven dollar is weakening amid the risk-on mood and as the Fed sticks to its dovish policy. US housing figures were mixed. The Fed's Bostic is set to speak later. 

EUR/USD News

GBP/USD extends corrective slide below 1.4200

GBP/USD trades around 1.4180, retreating from 1.4219, the highest since February. Britain's unemployment rate surprisingly dropped to 4.8% as the reopening continues. The dollar is on the back foot amid the upbeat market mood.

GBP/USD News

XAU/USD consolidates below $1870 amid risk-on mood

Gold price has entered a phase of upside consolidation, having faced rejection once again above $1870. The gold price looks unimpressed by the latest leg down in the US dollar, amid dovish Fed expectations.

Gold News

SEC attempts to block XRP holders from presenting evidence in Ripple case

The Securities & Exchange Commission filed another objection to the motion to intervene by XRP holders. The government agency argues that allowing third-party defendants into the case would “sow chaos” into the litigation.

Read more

Coinbase reveals intention to raise $1.25 billion following direct listing

Since its debut on the Nasdaq, Coinbase’s share price has merely collapsed. Given the recent weakness in its stock price, the leading cryptocurrency exchange is looking for a further cash injection. 

Read more

Forex MAJORS

Cryptocurrencies

Signatures