Even more so that the Euro, the British Pound proved unable to hold on to its NFP driven spike in GBPUSD with a long wick underscoring its rejection from its trend line. As they were US numbers were not drastically weak to likely change the Fed’s stance more concerned with inflation pressures than generating jobs. The likely hood of the BoE being the first major central bank to cut rates remains and shall continue to weigh on the currency. Note today is Early May Bank Holiday for the UK.
Resistance
- 1.26342 – Friday’s High
- 1.26092 – 50D Moving Average
- 1.25586 – Bearish Trend line
Support
- 1.25286 – Friday Whipsaw Low
- 1.24995 – Intraday Consolidation Resistance
- 1.24713 – Daily Range Play Floor
Given the long wick in the daily charts and immediate proximity to the bearish trend line, our bias for GBPUSD will be to sell. A push below Friday’s lows may be seen as an excuse to jump short with stops above the trend line, ideally above Friday’s high as we look to resume the previous weeks trading range. It would take a daily close above the trend line or a bounce off 1.24713 to convince us to go long.
