GBPUSD slide today testing the 1.30 mark as the correction that started three days ago continue today. USD is attracting some bids today across the board after several days of selling pressure. On Monday the pair hit the highest level since March 10 and entered overbought territory something that triggered today’s profit-taking.
The rising number of new COVID-19 infection cases in the USA and the speculation for a new relief package weigh on the greenback. Chicago Fed President Evans warned yesterday that more troubles are brewing ahead for the economy as the current relief package expires and asked for new fiscal measures to support the coronavirus battered economy.
On the other side of the forex pair, GBP continues to face the pressure from the uncertainty around the Brexit negotiations with the EU. At the same time, as the coronavirus new infections rise in some UK areas, investors fear that the UK government might halt the reopening process.
The Bank of England (BOE) will announce its monetary policy decision on interest rates on Thursday, with economists expecting the BOE to keep interest rates unchanged and also keep unchanged the quantitative easing. Money markets have already discount negative interest rates in the first months of 2021.
GBPUSD Daily Technical Analysis
GBPUSD is 0.66% lower at 1.2989, as the correction from five-month highs gains traction. Bearish traders achieved today at least for now to break below the 1.30 mark. Now they target the low from July 28 session at 1.2845. What can cancel the bullish momentum is a break below the 1.2703 the 200-day moving average.
On the flip side, initial resistance stands at 1.3108 today’s top. While the next supply zone awaits at 1.3180 the top from July 31. Next hurdle would be met at 1.3203 the high from March 9.