GBP/USD Pulls Back to Key Support

<p>GBP/USD (daily chart shown below) has pulled back sharply in the past two weeks from its new 2015 high of 1.5813 that was reached in […]</p>

GBP/USD (daily chart shown below) has pulled back sharply in the past two weeks from its new 2015 high of 1.5813 that was reached in mid-May. Currently, this pullback has brought the currency pair back down to dip below its key support target of 1.5250.

In the process of this breakdown, GBP/USD has dropped below several support factors, including the 1.5500 level, an uptrend line running from mid-April to late May, and the 200-day moving average.

In doing so, the currency pair has given back a good portion of the gains made during the most recent rebound and partial recovery that occurred in April and May.

2015-05-29-GBPUSD daily chart

 

Having pulled back so sharply from this partial recovery in the midst of renewed US dollar strength within the past two weeks, GBP/USD is currently trading at a critical juncture between its 200-day moving average to the upside and its 50-day moving average to the downside.

Still entrenched within a longer-term bearish trend that originated from the 1.7190 high in July of last year, the currency pair could be poised to reassert this downtrend.

A sustained break below the noted 1.5250 support area could lead to a breakdown below the 50-day moving average and a subsequent targeting of further downside support objectives at 1.5000 and then 1.4800.

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