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21 Dec 2015
GBP/USD broadly bearish on CB divergences/oil
FXStreet (Guatemala) - GBP/USD, on a wider approach, is offered below the 20 DMA at 1.5058 with spot tucked in below the 1.50 handle and testing the resilience of the bull's commitments at 1.4900 having recovered from last week's business below this level and lows of 1.4886.
We are in thin markets and price action is expected to be quiet outside any major positioning and subsequent flows that could cause a stir in holiday season. Still, there will be fundamentals out this week, and we have already got some surprise dovish comments from BoE's Weale that, if anything, could be a catalyst for a weak pound this week given the divergence between the Fed and other Central Banks into the first half of 2016. We also have GDP Q3 for both UK and the US and US PCE and durable goods orders as well.Oil will also remain a factor weighing on the pound until/unless that short squeeze occurs? WTI $32.26 bbl was the recent low. UK crude's was $36.32 bbl.
GBP/USD levels
Meanwhile and technically, key support at the 1.4897/60 recent lows are a Fibonacci retracement level as well and this should be a strong level of support guarding 1.4577 April lows looking back on the daily chart without much in the way once the 1.48 handle has given way except for mid march support at 1.4730/50. 1.4990/00 could be equally a strong level of resistance according to the Elliott waves with headwinds below the 200 DMA at 1.5321 today.
We are in thin markets and price action is expected to be quiet outside any major positioning and subsequent flows that could cause a stir in holiday season. Still, there will be fundamentals out this week, and we have already got some surprise dovish comments from BoE's Weale that, if anything, could be a catalyst for a weak pound this week given the divergence between the Fed and other Central Banks into the first half of 2016. We also have GDP Q3 for both UK and the US and US PCE and durable goods orders as well.Oil will also remain a factor weighing on the pound until/unless that short squeeze occurs? WTI $32.26 bbl was the recent low. UK crude's was $36.32 bbl.
GBP/USD levels
Meanwhile and technically, key support at the 1.4897/60 recent lows are a Fibonacci retracement level as well and this should be a strong level of support guarding 1.4577 April lows looking back on the daily chart without much in the way once the 1.48 handle has given way except for mid march support at 1.4730/50. 1.4990/00 could be equally a strong level of resistance according to the Elliott waves with headwinds below the 200 DMA at 1.5321 today.