Wednesday, October 28, 2015

GBP/USD hovers above 1.53, bulls back in charge?

FXStreet (Mumbai) - The overnight recovery in the GBP/USD pair lost traction near 5-DMA located at 1.5315, and the major eases slightly after the US dollar resumed its upside amid widespread risk-aversion.

Moves further away from 200-DMA at 1.5350

The GBP/USD pair trades modestly flat at 1.5310, retreating from fresh session lows reached at 1.5296 last minutes. The major bounced-off lows and now hovers above 1.53 barrier as the US dollar stays resilient, despite dismal durable goods orders and consumer confidence numbers, with markets expecting FOMC outcome to emerge eventless and turn out to be USD positive.

The cable remains pressured as the depressing UK GDP numbers released on Tuesday, continue to dampen the sentiment around the GBP. The UK GDP for Q3 ticked lower from 0.7% to 0.5% q/q, while y/y showed a slight drop off from 2.4% to 2.3%.

Meanwhile, light trading is expected for the major as the UK docket remains absolutely data-empty. Besides, the Fed decision will remain the main market mover in the day ahead.

GBP/USD Levels to consider

The pair has an immediate resistance at 1.5350 (200-DMA) above which gains could be extended to 1.5400/07 (round number + 1h 200-SMA). On the flip side, support is seen at 1.5250/32 (psychological levels+ daily S2) below which it could extend losses to 1.5200 (round number).
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