GBP/USD Bounce Rejected at Key Fibonacci Stage as USD Sellers Wrestle For Momentum

Speaking Factors:

  • GBP/USD faces sturdy resistance slightly below 1.36
  • With a light-weight financial calendar this week, focus can be on NF knowledge out on Friday

GBP/USD is struggling to interrupt above a key Fibonacci stage regardless of continued assist from consumers. The pair has managed to stage a great comeback since final Thursday because the US Dollar has come off barely from its spectacular rally final week however there isn’t a transparent path larger as resistance looms shut by.

The world between the 23.6% Fibonacci retracement (1.3577) from the February 2021 highs and the 1.36 mark is the important thing problem up forward and with a scarcity of information on the calendar for immediately’s session and a reasonably quiet begin to the week in markets we may count on GBP/USD to stay round present ranges all through the day, with attainable sideways consolidation within the coming classes. Final week’s bounce does appear to have gotten a bit forward of itself and with the pair buying and selling beneath its key transferring averages, the short-term shopping for momentum appears to be pressured.

GBP/USD Every day Chart

GBP/USD Bounce Rejected at Key Fibonacci Level as USD Sellers Struggle For Momentum

The calendar is fairly weak for the UK this week with just some PMI knowledge popping out over the following few days. The main focus can be on the roles knowledge for the US on Friday, which has had loads of emphases placed on it because the Fed has signaled {that a} sturdy studying would probably result in the beginning of financial tightening in its November FOMC assembly. The info may also draw loads of consideration as fears of stagflation have began to mount, with a powerful jobs studying probably pushing again these fears about development stagnating anytime quickly.

On the Greenback facet, the DXY has been rejected inside the resistance space (94.27 – 94.79) I mentioned last week. These are the September and October 2020 highs, and each of them have been adopted by sturdy pullbacks so a rise in bearish strain was anticipated. The query now’s whether or not Greenback bulls are going to have the ability to maintain the DXY above 94 over the approaching days because the final two every day candlesticks present tried bearish reversals however sturdy assist thus far round 93.90 with Sunday’s opening candlestick exhibiting a hammer sample, which would be the indicating a short-term backside.

DXY Every day Chart

GBP/USD Bounce Rejected at Key Fibonacci Level as USD Sellers Struggle For Momentum

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— Written by Daniela Sabin Hathorn, Market Analyst

Observe Daniela on Twitter @HathornSabin

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