Chart Of The Day: GBPUSD Pulled Back From 50-day EMA

February 08, 2016 06:14

Even as upbeat data-points from the UK, coupled with not so dovish remarks in BoE's quarterly inflation report, fueled the GBPUSD's recovery from 1.4080 towards marking the highest level in a month, the pair failed to surpass the 50-day EMA on a closing, indicating a pullback to 1.4360-50 immediate support. Given the pair's continued south-run below 1.4350, the 1.4230-20 might act as intermediate support before the pair could drop to 1.4100 – 1.4080 support region. Moreover, pair's extended downside below 1.4080 could further weaken it to test the 1.3800 area.

On the upside, the 50-day EMA, near 1.4650, can continue acting as strong nearby resistance for the pair to clear before it could rally to 1.4785 – 1.4800 resistance-zone, encompassing 38.2% Fibonacci Retracement of its June 2015 – January 2016 downside. Should the pair successfully surpasses the 1.4800 mark, the six month old descending trend-line, around 1.4950, followed by the 50% Fibo, near 1.5050, are likely important resistances that the pair trader should watch for.

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