GBP/USD rebounds toward 1.3900 as USD weakens
GBP/USD extends the previous two day’s gains in Wednesday’s Asian session. The pair trades in a very narrow trade band and awaits for confirmation. At the time of writing, GBP/USD is trading at 1.3879, up 0.04% for the day.
The US Dollar Index (DXY), which tracks the greenback performance against its six major rivals, trades below 92.50, with 0.17% losses. Investors remain nervous about the Fed’s interests rate decision.
Technical analysis: Will the GBP/USD retreat reverse?
The GBPUSD technical analysis of the price chart on a 1-hour timeframe shows GBPUSD: H1 is retracing above the 200-period moving average MA(200) which is falling itself. We believe the bearish movement will continue after the price breaches below the lower bound of the Donchian channel at 1.3765. A level below this can be used as an entry point for placing a pending order to sell. The stop loss can be placed above 1.3828. After placing the order, the stop loss is to be moved to the next fractal high indicator, following Parabolic signals. Thus, we are changing the expected profit/loss ratio to the breakeven point. If the price meets the stop loss level without reaching the order, we recommend cancelling the order: the market has undergone internal changes which were not taken into account.
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