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$1.40 Handle Moves Back into View

GBP
MNI (London)
  • GBP/USD again met support around the $1.3860 in Wednesday trade into NY before rate recovered through the NY session to a high of $1.3951, the move aided by the continued dovish message from the FOMC/Fed Powell.
  • Move seen in tandem with EUR/USD as EUR/GBP continues to hold close to Gbp0.8700, though the cross remains above its key 10-dma keeping GBP advances in check.
  • GBP/USD closed at $1.3939, marked an opening low of $1.3934 in a Tokyo holiday thinned Asian session, before rate extended its recovery on to $1.3977 before stalling.
  • Rate reversed to $1.3940 then edged back to $1.3959 ahead of the European open.
  • Support $1.3940/30, stronger into $1.3900. Resistance $1.3977/80, a break to expose the $1.4000 handle. Rate has struggled in recent sessions to build on shows above $1.4000, with main resistance noted between $1.4009/20. Break to open a move toward $1.4050, with $1.4103 lurking inthe background (76.4% $1.4237-1.3669).
  • A light UK calendar for Thursday. Focus on US GDP, Core PCE, Pending Home Sales.
  • Month-end approaching with models suggesting USD sales to be seen at Friday's fixes.
  • MNI Techs: GBPUSD has resumed its recent recovery but remains below recent highs of 1.4009. This marks the Apr 20 high and the recent pullback from this resistance highlights a bearish threat. Cable needs to clear 1.4009 to offset these concerns. A break higher would reinstate a bullish theme and open 1.4103, a Fibonacci retracement. Short-term support has been defined at 1.3824, Apr 22 low.
MNI London Bureau | +44 203-586-2231 | john.webb@marketnews.com
BulletMarketsForeign Exchange Bullets
MNI London Bureau | +44 203-586-2231 | john.webb@marketnews.com
BulletMarketsForeign Exchange Bullets

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