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4 Jan 2016
GBP/USD: consolidating before further downside? - FXStreet
FXStreet (Barcelona) - Valeria Bednarik, chief analyst at FXStreet explained that the British Pound was among the biggest losers this December, closing the month against the greenback at a fresh 8-month low set at 1.4725.
Key Quotes:
"The movement may have been exacerbated during the last two weeks by the reduced volumes, but the Pound has came under pressure mid last year, when chances of a rate hike got diminished by softening local macroeconomic data. The British currency also suffered lately by mounting speculation over a referendum on remaining within the EU, to be launched this year. But for the most, the GBP/USD plunged as traders unwound their buys taken on confidence on the economic growth.
From a technical point of view, the daily chart shows that the price has fallen further below a strongly bearish 20 SMA, while the technical indicators maintain their bearish slopes near oversold territory, all of which supports additional declines. In the 4 hours chart, the price is also well below a bearish 20 SMA while the RSI indicator hovers in oversold territory and the Momentum indicator aims higher, but below 100, pointing for some consolidation ahead of a new leg south."
Key Quotes:
"The movement may have been exacerbated during the last two weeks by the reduced volumes, but the Pound has came under pressure mid last year, when chances of a rate hike got diminished by softening local macroeconomic data. The British currency also suffered lately by mounting speculation over a referendum on remaining within the EU, to be launched this year. But for the most, the GBP/USD plunged as traders unwound their buys taken on confidence on the economic growth.
From a technical point of view, the daily chart shows that the price has fallen further below a strongly bearish 20 SMA, while the technical indicators maintain their bearish slopes near oversold territory, all of which supports additional declines. In the 4 hours chart, the price is also well below a bearish 20 SMA while the RSI indicator hovers in oversold territory and the Momentum indicator aims higher, but below 100, pointing for some consolidation ahead of a new leg south."