Similarly to other major currencies, the Pound retrieved from its recent highs against the US Dollar and edged lower on Friday. It breached the 55-hour SMA and was testing the longer-term moving average and the weekly PP circa 1.4130 on Monday morning. This level coincides with the bottom boundary of a three-week ascending triangle which has constrained the pair’s recent period of appreciation.
Meanwhile, this trading session started with low volatility, as bears were reluctant to breach the nearest support. This area, however, is expected to surrender, thus allowing the Pound to approach the 200-hour SMA located near the 1.40 mark.
The pair is likely to remain in the 1.4050/1.4100 range by Tuesday morning.
