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Forex Analysis: GBP/USD Continues Retreat after Downturn

2013-08-30-GBPUSD

August 30, 2013 – GBP/USD (daily chart) has continued to fall back after having hit a two-month high at 1.5716 last week – just shy of the major 1.5750 resistance level – and then turning back to the downside. The resulting bearish retreat of the past week and a half has brought the currency pair back down once again to approach major support around the 1.5400 area, one of the most pivotal support/resistance levels for GBP/USD in recent weeks and months. The downward-sloping 200-day moving average also currently resides just under 1.5400 support. With significant downside momentum currently prevailing for the pair, and renewed dollar strength tentatively in play virtually across the board, a key bearish indication would be a breakdown below 1.5400 support. This event would confirm a further bearish bias for the pair, with initial downside support objectives residing around 1.5250 and then the key 1.5000 psychological level.

James Chen, CMT
Chief Technical Strategist
City Index Group

 

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James Chen

James Chen

James Chen is Chief Technical Strategist for City Index Group. He is also a Chartered Market Technician. He is the author of the books: "Essentials of Foreign Exchange Trading" (John Wiley & Sons, 2009) and "Essentials of Technical Analysis for Financial Markets" (John Wiley & Sons, 2010). Mr. Chen writes currency analysis, leads forex trading seminars and has appeared in numerous major financial media outlets, including CNBC, Bloomberg TV, Forbes, Reuters, Dow Jones, and the Associated Press.