29 Oct 2013
GBP/USD consolidates below 1.6100
FXstreet.com (Edinburgh) - The pound continues to grind lower on Tuesday, pushing the GBP/USD deeper below the 1.6100 handle ahead of US data.
GBP/USD closer to the 55-day MA at 1.6013
The offered tone remains intact around the pound despite UK Mortgage Approvals increasing to 66.735K in September, the highest level since 2008, surpassing estimates and August’s reading. However, further data from the British economy showed that Consumer Credit fell to £0.411 billion vs. £0.62 billion, M4 Money Supply banged on estimates and Net Lending to Individuals fell to £1.4 billion. All in all, grim news for GBP keeps adding to the selling pressure, now hovering over 1.6065/60, or session lows. Jane Foley, Strategist at Rabobank, observed, “In the assumption that we do not expect the Federal Reserve to start tapering the size of its monthly asset purchases until March next year, the USD is likely to remain on the back foot and this is set to leave GBP/USD well supported going forward. We expect cable to remain close to current levels on a 1 to 3 mth view and then move back below the GBP/USD1.60 area on the anticipation that the USD regains some traction ahead of the March FOMC”.
GBP/USD key levels
The pair is now losing 0.44% at 1.6070 and a break below 1.6013 (MA55d) would aim for the psychological level at 1.6000 and finally 1.5894 (low Oct.16). On the upside, the initial barrier lies at 1.6207 (high Oct.28) followed by 1.6248 (high Oct.25) and then 1.6258 (high Oct.23).
GBP/USD closer to the 55-day MA at 1.6013
The offered tone remains intact around the pound despite UK Mortgage Approvals increasing to 66.735K in September, the highest level since 2008, surpassing estimates and August’s reading. However, further data from the British economy showed that Consumer Credit fell to £0.411 billion vs. £0.62 billion, M4 Money Supply banged on estimates and Net Lending to Individuals fell to £1.4 billion. All in all, grim news for GBP keeps adding to the selling pressure, now hovering over 1.6065/60, or session lows. Jane Foley, Strategist at Rabobank, observed, “In the assumption that we do not expect the Federal Reserve to start tapering the size of its monthly asset purchases until March next year, the USD is likely to remain on the back foot and this is set to leave GBP/USD well supported going forward. We expect cable to remain close to current levels on a 1 to 3 mth view and then move back below the GBP/USD1.60 area on the anticipation that the USD regains some traction ahead of the March FOMC”.
GBP/USD key levels
The pair is now losing 0.44% at 1.6070 and a break below 1.6013 (MA55d) would aim for the psychological level at 1.6000 and finally 1.5894 (low Oct.16). On the upside, the initial barrier lies at 1.6207 (high Oct.28) followed by 1.6248 (high Oct.25) and then 1.6258 (high Oct.23).