24 Mar 2014
GBP/USD fades the spike, back to 1.6500
FXStreet (Edinburgh) - After almost hitting 1.6540, the GBP/USD has now retraced the spike to fresh highs and is now trading back to the vicinity of 1.6500 the figure.
GBP/USD stronger on dollar weakness
There really wasn’t a defined catalyst behind that bull attempt other than the breach by the DXY of the psychological mark at 80.00, triggering the usual orders and thus magnifying the movement. Paul Robson, Senior FX Strategist at RBS, observed, “Last week we warned that the risk was price just slips back lower towards 1.6450/1.6500. This materialised, with spot slipping down to test this area… 1.6450/1.6500 remains the initial support zone. However, rallies may struggle in the 1.6540/50 area initially, with maybe an assault on the 1.6590/1.6600 area”.
GBP/USD levels to watch
The pair is now up 0.06% at 1.6499 with the next resistance at 1.6550 (55-d MA) ahead of 1.6570 (high Mar.20) and finally 1.6575 (10-d MA). On the downside, a break below 1.6453 (38.2% of 1.5854-1/6823) would open the door to 1.6425 (low Feb.12) and then 1.6392 (low Feb.11).
GBP/USD stronger on dollar weakness
There really wasn’t a defined catalyst behind that bull attempt other than the breach by the DXY of the psychological mark at 80.00, triggering the usual orders and thus magnifying the movement. Paul Robson, Senior FX Strategist at RBS, observed, “Last week we warned that the risk was price just slips back lower towards 1.6450/1.6500. This materialised, with spot slipping down to test this area… 1.6450/1.6500 remains the initial support zone. However, rallies may struggle in the 1.6540/50 area initially, with maybe an assault on the 1.6590/1.6600 area”.
GBP/USD levels to watch
The pair is now up 0.06% at 1.6499 with the next resistance at 1.6550 (55-d MA) ahead of 1.6570 (high Mar.20) and finally 1.6575 (10-d MA). On the downside, a break below 1.6453 (38.2% of 1.5854-1/6823) would open the door to 1.6425 (low Feb.12) and then 1.6392 (low Feb.11).