GBP/USD Forecast: Pound Sterling closes in on key 1.2800 support
GBP/USD turned south in the European session on Monday and dropped to its lowest level in two weeks below 1.2810. The pair's technical outlook points to a bearish bias as investors await S&P Global PMI surveys for the US. S&P Global/CIPS Manufacturing PMI for the UK dropped to 45 in July's flash estimate from 46.5 in June. Additionally, the Services PMI declined to 51.5 from 53.7, unveiling a loss of momentum in the services sector's business activity.
Assessing the survey's findings, “the UK economy has come close to stalling in July which, combined with gloomy forward-looking indicators, reignites recession worries,” said Chris Williamson, Chief Business Economist at S&P Global Market Intelligence. Read more…
GBP/USD outlook: Second Doji signals that bears might be losing traction
Cable edged lower in early Monday and hit new marginally lower two-week low, after bears probed through pivotal supports at 1.2866/48 (Fibo 50% of 1.2590/1.3141 / 20DMA) though losses were limited and near-term action influenced by Friday’s Doji candle, being so far in the same shape. Bears pressure next pivot at 1.2801 (Fibo 61.8%) violation of which would further weaken near-term structure for deeper pullback.
On the other hand, oversold stochastic and neutral RSI, suggest that bears may take a breather above 1.2800 zone, with bearish bias expected to remain intact while the price action stays below broken Fibo 38.2% level at 1.2931, while acceleration through upper pivots at 1.2974/1.3000 (10DMA / psychological) would revive bulls and signal an end of corrective phase. Read more…
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