The GBP/USD has dropped sharply in the yesterday’s trading session and seems poised to start a corrective phase. Price is going down as the USD has managed to increase after the USDX’s rebound. The pair is trading in the red on the short term and could hit fresh new lows in the upcoming hours if the United States data will come in line with expectations or better in the afternoon. Technically, a retreat is natural after the failure to close above a dynamic resistance.
We may have some volatility later after the UK and the US data will be sent to the public, the BOE is to release the Official Bank Rate, which is expected to remain steady at 0.25%, while the Asset Purchase Facility shouldn’t suffer any change.
Price continues to be trapped within the ascending channel’s body, has retested the upside line and now could drop again. Technically, it could drop again after another failure to close above the red up sloping line. Now is pressuring the warning line (wl1) of the ascending pitchfork, a valid breakdown will confirm a further drop. The next downside targets will be at the 1.3046 level, actually could be attracted by the confluence area formed between the 250% Fibonacci line with the 1.3046 horizontal obstacle.
Is premature to talk about a broader drop because is located above some important support levels, only a breakdown below the 250% Fibonacci line will confirm a larger decrease.
