The GBP/USD pair is currently focused on support levels due to its recent inability to break above the 200-day moving average at 1.2557, which emphasises its negative bias. If the ‘black cloud cover’ candlestick pattern materializes, there could be potential for more losses, with 1.2400 being the objective and perhaps even 1.2300 as the YTD low.
The pound sterling drops and loses ground versus the US dollar during the mid-North American session, falling below 1.2500. US data indicated that inflation is increasing, which would discourage the Fed from lowering interest rates. The GBP/USD exchange rate is down 027% at 1.2481.
Technical Outlook:
Despite closing three days of straight gains, the GBP/USD pair is still biassed lower as buyers were unable to overcome resistance at the 200-day moving average (DMA) at 1.2557. That revealed the 1.2500 number, which fundamental news had given up.
There could be more losses if the GBP/USD closes Friday’s trading at roughly 1.2480, creating a “dark cloud cover.” The year-to-date (YTD) at 1.2300 would be the next support level, at 1.2400. Alternatively, buyers could challenge the 200-DMA if they raise the market price above 1.2500.
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