GBP/USD: Further Declines to Follow to 1.4370 - FXStreet

GBP/USD: Further Declines to Follow to 1.4370 - FXStreet

4 May 2016, 00:36
Roberto Jacobs

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."


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