Friday, September 18, 2015

GBP/USD: Bulls taking a breather or fear risk aversion?

FXStreet (Mumbai) - The GBP/USD pair was rejected at 1.5605 in the early Europe, but remain consolidated around 1.5580 levels on signs of risk aversion in the European equity futures.

Bid tone weakens as Euro Stoxx 50 drops

The GBP bulls lack intent to push the pair over and above 1.56 levels as the risk aversion in the financial markets is perceived as a hindrance to Bank of England rate hike as well. Moreover, the Fed’s decision to turn dovish has not been well received by the financial markets.

The Euro Stoxx 50 futures currently trade almost 1.5%. Consequently, risk assets, including Sterling are having a tough time advancing in Europe.

GBP/USD Technical Levels

The immediate resistance is located at 1.5605, above which the spot could test 1.5690 (July 29 high). On the other side, support is seen at 1.5557 (daily low) and 1.5522 (50-DMA).
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