GBP/USD Rebounds after 18-Month Low
James Chen January 28, 2015 7:16 PM
<p>GBP/USD (daily chart shown below) has rebounded after having hit a new 18-month low below 1.5000 late last week. The currency pair dropped to 1.4950 […]</p>
GBP/USD (daily chart shown below) has rebounded after having hit a new 18-month low below 1.5000 late last week. The currency pair dropped to 1.4950 on Friday, a level not seen since July of 2013.
Prior to last week’s low, GBP/USD had continued to trade within a sharp bearish trend from the 1.7190 high in mid-July of last year. The pair kicked off 2015 with a dramatic plunge that broke down swiftly below the 1.5400 and then 1.5250 support levels.
The 1.5000 psychological support level had been the next major downside target, which was quickly hit on last week’s drop.
This week’s rebound has pushed the currency pair up towards key resistance around the 1.5250 prior support level. If the rebound is able to push above this resistance, the next higher resistance resides around 1.5400.
Despite the current rebound, however, downside pressure should continue to prevail. A continuation of the entrenched downtrend on a turn back down below 1.5000 should begin to target lower support levels around 1.4800 and then 1.4500.
StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.