- Cable rebounds further, finds resistance at the 1.4200 area.
- Pound also faces resistance against the euro and losses momentum.
The GBP/USD rose further during the American session and peaked at 1.4200. Like Thursday, it was unable to break the 1.4200 area and pulled back. The retracement found support at 1.4165 and the pair is about to end the week flat hovering around 1.4160/70.
The pound recovered sharply after falling before the NFP to 1.4082, the lowest level in almost three weeks. From the lows it bounced to the upside, boosted by the decline of the US dollar after the US employment report that came in below expectations.
Also the pound lost some momentum after the EUR/GBP moved off lows, rising again back above a key support level. A close clearly below 0.8560/70 could trigger more losses in the cross, adding strength to the pound.
GBP/USD Technical outlook
The pound is about to end the week practically unchanged against the US dollar after being unable to hold above 1.4200 while at the same time rebounding sharply from below 1.4100. Yohay Elam, Analyst at FXStreet, points out the daily chart in GBP/USD still points to an uptrend, “at least as long as cable holds above the 1.4010 line that is a clear separator of ranges. In the meantime, momentum remains to the upside and the currency pair is trading well above the 50 day, 100-day and 200-day simple moving averages, a bullish sign.”
On the downside, Elam points out that soft support awaits at 1.4050, “ahead of critical support at 1.4010 mentioned earlier. Further down, 1.3980, 1.3930 and 1.3850 come into play.”
Technical levels
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