VOT Research Desk
The GBPUSD pair experiences significant selling pressure on Wednesday, which stops a three-day positive trend and pushes the price to a one-week high.
Early in the North American session, the intraday decline accelerates and pushes spot prices to a new daily low.
Bearish traders are now watching for sustained weakness below the 1.1400 level.
A recent increase in US Treasury bond yields, along with a generally weaker tone on the equity markets, help the US Dollar stage a modest recovery from a multi-week low. The Bank of England’s pessimistic assessment of the UK economy, on the other hand, weighs heavily on the value of the British pound.
The nighttime failure close to the round-figure 1.1600 level strengthens the unfavourable prognosis.
To be cautious, however, because technical indications on the daily chart have not yet verified a negative tilt.
Because of this, it is wise to hold out on verifying that the post-NFP recovery move from levels just below the mid-1.1100s has peaked before setting up for another depreciating move for the GBPUSD pair and waiting for any follow-through selling.
GBP/USD Technical Analysis
The decline in spot prices may then quicken to the 1.1355-1.1350 intermediate support before ending at the 1.1300 round number.
The GBPUSD pair may attempt to retest last week’s swing low, in the mid-1.1100s, below the 1.1200 level if the negative trend continues to be extended.
On the other hand, the area between 1.1445 and 1.1450 appears to be acting as an immediate strong barrier before the psychological level of 1.1500.
In the vicinity of 1.1575-1.1580, any additional recovery may continue to draw new supply and be constrained.
Nevertheless, some further purchasing above the 1.1600 level will counteract the bearish tendency and push the GBPUSD pair up into the October monthly swing high, or about 1.1645.
