GBPUSD Extends Losing Streak As US Services Sector Expands

The Great Britain Pound (GBP) extended downside movement against the US Dollar (USD) on Wednesday, dragging the price of GBPUSD to less than 1.4150 following the release of some key economic news. The technical bias remains bearish because of a Lower High in the recent upside rally.

Technical Analysis

As of this writing, the pair is being traded near 1.4144. A support may be noted near 1.4114, a major horizontal support as demonstrated in the following daily chart. A break and daily closing below the 1.4114 support area could incite renewed selling pressure, validating a move below the 1.4052 support area.

GBPUSD Extends Losing Streak As US Services Sector Expands

On the upside, the pair is likely to face a hurdle near 1.4321, the high of the recent short-term rally on the four-hour timeframe ahead of 1.4459, the swing high of the last major upside rally. The technical bias will remain bearish as long as the 1.4459 resistance area is intact.

US Services Sector Expands

The U.S. economy’s service sector expanded in March, a signal that business conditions are moving at a positive pace, according to an industry report released on Tuesday. The Institute for Supply Management (ISM) said its index of non-manufacturing activity rose to 54.5 from 53.4 the month before. The reading was just above expectations of 54.0 from a Reuters poll of 74 economists. A reading above 50 indicates expansion in the service sector and a reading below 50 indicates contraction.

Trade Idea

Considering the overall technical and fundamental analysis, buying the pair near the above mentioned support levels appears to be a good strategy in short to medium term if we get a valid bullish reversal candle on the daily chart.

 

How useful was this post?

Click on a star to rate it!

Average rating / 5. Vote count:

No votes so far! Be the first to rate this post.

We are sorry that this post was not useful for you!

Let us improve this post!

Tell us how we can improve this post?

Latest posts by Usman Ahmed (see all)
with No Comments 1353
Scroll Up