GBP/USD: Further Declines to Follow to 1.4370 - FXStreet
Valeria Bednarik,
chief analyst at FXStreet explained that following an advance to
1.4769, a fresh 4-month high, the GBP/USD pair plunged to 1.4530".
Extra related reading: Brexit Countdown: the "Has Britain Got Talent?" edition
Key Quotes:
"The
Pound initially hit by the final revision of the UK April Markit
manufacturing PMI that fell below 50.00 for the first time since March
2013, coming in at 49.2. The decline in the pair was later fueled by a
sharp comeback of the greenback during the US afternoon, and the pair
remains unable to pick up ahead of the Asian opening, trading near the
mentioned low at the end of the day."
"The daily decline stalled a
couple of pips above a major support, the 38.2% retracement of the
latest bullish run, triggered by easing fears over a Brexit, at 1.4525,
now the main support."
"From a technical point of view, the 4
hours chart supports some further declines as the divergence drew by the
Momentum indicator, which started mid last month, got confirmed when
the indicator broke below its mid-line.
In the same chart, the
RSI indicator consolidates at 42, rather reflecting the scarce volume
typical of this time of the day than suggesting downward exhaustion,
whilst the 20 SMA has turned flat in the 1.4630 region. Renewed selling
interest below the mentioned Fibonacci support can see the pair sliding
down to the 1.4370 region, the 61.8% retracement of the same rally."
