GBP/USD outlook: Limited correction may precede bearish continuation
|GBP/USD
Cable is trading within a narrow range in early Wednesday after hitting new 2021 low (1.3342) on Tuesday but failing to sustain break below previous low of Nov 12 (1.3353).
Overall structure remains bearish but long tail of Tuesday’s candle, accompanied with fading negative momentum and oversold stochastic on daily chart, suggest that bears may take a breather before larger downtrend resumes.
Initial resistance lays at 1.3420 (converged 5/10DMA, attempting to form a bear-cross) with extended upticks expected to remain below 1.3500 zone (Nov 18 lower top / falling 20DMA) to keep bears in play for extension towards 1.3288 (100WMA) and more significant support at 1.3164 (Fibo 38.2% of 1.1409/1.4249/200WMA).
Caution on firm break of 1.3500 zone that would confirm a double bottom and generate reversal signal.
Traders focus on release of US data (weekly jobless claims; Q3 GDP estimation; durable goods orders and FOMC minutes) which would provide some signals, but also consider a lower volume on Thursday as the US will be shut for a Thanksgiving Day.
Res: 1.3400; 1.3420; 1.3454; 1.3513.
Sup: 1.3342; 1.3288; 1.3200; 1.3164.
Interested in GBP/USD technicals? Check out the key levels
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.