GBP/USD Extends Losses Against USD
- The Pound Sterling continues to decline against the US Dollar, breaking below the 200-day SMA.
- Technical indicators point to further bearish momentum, with support at 1.2665 in focus.
- A potential recovery above 1.2700 could lead to a test of resistance at the recent high of 1.2873.
In early North American trading, the Pound Sterling is facing losses against the US Dollar, influenced by hawkish comments from Bank of England’s Catherine Mann. Additionally, the latest US inflation report met expectations, keeping the GBP/USD pair trading around 1.2697, marking a decrease of over 0.37%.
GBP/USD Price Forecast: Technical Outlook
The bearish momentum for GBP/USD has continued as the pair dropped below the 200-day Simple Moving Average (SMA) at 1.2817. This has opened the door for a challenge at the 1.2800 level. The current momentum favors a downward trend, with the pair reaching a daily low of 1.2686, approaching the intermediate support at the August 8 swing low of 1.2665. If this support is breached, the next level to watch is the 1.2600 mark.
On the other hand, if buyers manage to push the exchange rate above 1.2700, the next resistance level to overcome would be the November 12 high at 1.2873.
Technical indicators like the Relative Strength Index (RSI) suggest that sellers are dominating the market, indicating a potential for further downside in GBP/USD.
GBP/USD Price Chart – Daily
Pound Sterling FAQs
Here are some frequently asked questions about the Pound Sterling:
1. What is the Pound Sterling?
The Pound Sterling (GBP) is the official currency of the United Kingdom and is the oldest currency in the world, dating back to 886 AD. It is the fourth most traded currency in the foreign exchange market, with key trading pairs including GBP/USD, GBP/JPY, and EUR/GBP.
2. What influences the value of the Pound Sterling?
The value of the Pound Sterling is primarily influenced by monetary policy decisions made by the Bank of England. Factors such as interest rates, inflation rates, and economic data releases can impact the value of GBP.
3. How does economic data affect the Pound Sterling?
Data releases like GDP, PMIs, and employment figures can provide insights into the health of the economy, influencing the direction of the Pound Sterling. A strong economy is typically positive for GBP, while weak economic indicators can lead to a decline in the currency’s value.
4. What role does the Trade Balance play in GBP’s value?
The Trade Balance, which measures a country’s exports and imports, can impact the value of the Pound Sterling. A positive Trade Balance strengthens the currency, while a negative balance can lead to a depreciation of GBP.
Analysis:
The rewritten content provides a comprehensive overview of the GBP/USD pair’s current situation, technical outlook, and factors influencing the Pound Sterling’s value. By breaking down complex financial concepts and technical indicators into easily digestible information, even readers with limited financial knowledge can understand the content. The inclusion of FAQs about the Pound Sterling further enhances the reader’s understanding of the currency and its market dynamics. Overall, the article aims to educate and inform readers about the GBP/USD pair and how economic factors can impact their financial decisions and future investments.