Technical Analysis

GBP/USD is unsure about a break of the key level for now

As highlighted last week, this will be a key level for sellers to break below if the downtrend is to continue. The pair hasn’t traded below the 200-day MA (blue line) since April 2017, and a break below it here will provide a fresh bearish bias in the pair that could accelerate further downside momentum.

The 200-day MA now sits at 1.3542, and looking at the dollar’s move today I can only see this as the only reason keeping the pair up for the time being. UK traders are away for today, so liquidity in sterling is a bit thin so we may only get a clear picture tomorrow.

But nonetheless, this is the key level that traders need to look out for in cable right now as it is the battleground between buyers and sellers in defining bias in the pair.

A break below opens up a move towards the 50.0 retracement level @ 1.3429. But bids are also expected at the 1.3500 level so be wary of that.

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