GBP/USD Drops Back Below 1.4500 Handle
After an initial spike to 1.4543 on disappointment from US ADP and labor productivity report, the GBP/USD pair turned back below 1.4500 handle to currently trade near 1.4480 level.
The US Dollar found support from better-than-expected trade deficit and ISM manufacturing PMI numbers. The US trade deficit shrank in March to $40.4 Billion, lowest since Feb. 2015, while the ISM non-manufacturing PMI rose to its highest level since Nov. 2015 by printing 55.7 for the month of April.
The GBP/USD pair's attempted recovery from lower levels attracted fresh offers near a previous support turned resistance near 1.4540 area. A follow-through selling pressure below 1.4480 would now open room for further corrective move for the pair.
Technical levels to watch
On a sustained weakness below 1.4480 level, marking 38.2% Fibonacci retracement level of 1.4009-1.4770 up-move, the pair seems to gain momentum and extend its depreciating move towards an important support confluence near 1.4385-80 area, comprising of 50% Fibonacci retracement level and 20-day SMA.
On the upside, beyond 1.4500 handle, 1.4540 remains immediate hurdle to conquer. A sustained break-through this immediate resistance the pair seems to dart towards 23.6% Fibonacci retracement level resistance near 1.4590-1.4600 round figure mark. Should the momentum be strong enough, it could possibly lift the pair towards 1.4670 strong resistance.