GBP/USD Hits 9-Month Low, Continues To Plummet
FX Solutions | Sep 09, 2014 12:31AM ET
GBP/USD (daily chart shown below) has continued its extreme plummet after gapping down below previous major support around the 1.6300 level. In the process, the currency pair has established a new nine-month low and a new low for 2014.
The steep decline of the past two months that signaled the potential beginnings of a new bearish trend began in earnest after the retreat from the mid-July multi-year high of 1.7190.
This two-month decline has broken down below several major support levels, including 1.7000, 1.6700, 1.6500, and most recently, the noted 1.6300 level, a major historical support and resistance level. In the process of this plunge, price action has also broken down swiftly below both the key 50-day and 200-day moving averages.
The 50-day moving average has also declined sharply to begin converging with the 200-day moving average, a major bearish indication. A cross of the 50-day below the 200-day could soon occur, a condition that has not occurred since February of 2013.
Having just broken down sharply below the noted 1.6300 prior support level, GBP/USD’s bearish momentum has been significantly extended. The next major downside support target resides around the key 1.6000 psychological support level, followed closely to the downside by the 1.5900 and then 1.5750 support targets.
Near-term upside resistance now resides tentatively around the broken 1.6300 level.
Disclosure: FX Solutions assumes no responsibility for errors, inaccuracies or omissions in these materials. FX Solutions does not warrant the accuracy or completeness of the information, text, graphics, links or other items contained within these materials. FX Solutions shall not be liable for any special, indirect, incidental, or consequential damages, including without limitation losses, lost revenues, or lost profits that may result from these materials.
The products offered by FX Solutions are leveraged products which carry a high level of risk to your capital with the possibility of losing more than your initial investment and may not be suitable for all investors. Ensure you fully understand the risks involved and seek independent advice if necessary.
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.