- The dollar recovers ground and cuts losses in the market.
- The pound among the weakest on Monday, in moderate session.
- GBP/USD in correction mode after failing to break above the 200-day moving average.
GBP/USD is falling for the second day in a row on Monday. Having approached 1.3700, the pair reversed direction and fell to 1.3655, reaching a low for the day, just above Friday’s low.
The very short-term tone remains down with next support at 1.3650 then 1.3620 follows and 1.3605 continues. To the upside, at the 1.3690 area there is a major resistance reinforced by the 20 moving average on the four hour chart.
The current pullback comes after a rally of several that reached 1.3748. But the pound was unable to assert itself above the 200 day moving average, which is passing through 1.3735. A close above that average would leave the GBP/USD ripe for more gains.
The UK currency shows some weakness and also falls against the euro. In the United Kingdom, the position of Prime Minister Boris Johnson is at risk after learning of events in which he participated during the COVID restrictions. As far as data is concerned, figures for the labor market will be released on Tuesday.
In the US, the markets will be closed on Monday for the Martin Luther King Jr. holiday. Normal activity and data will only return on Tuesday, with the Manufacturing Empire report.
Technical levels
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