Forex: GBP/USD weakens on Fed's Bernanke speech

FXstreet.com (Barcelona) - Fed's Bernanke statement at the Jackson Hole meeting showed a Chairman concerned with the stagnation of the US labor market and up for further easing, although leaving the decisions to the FOMC meeting on September 13.

"Taking due account of the uncertainties and limits of its policy tools, the Federal Reserve will provide additional policy accommodation as needed to promote a stronger economic recovery and sustained improvement in labor market conditions in a context of price stability", Bernanke concluded his speech.

Although dovish, the market was overpricing the GBPUSD, leaving room for a downfall after the statement. The GBPUSD was capped at 1.5890 and lost 60 pips in twenty minutes, to 1.5829 session low. Downside pressure remains.
"GBPUSD has eroded its short term uptrend and is starting to struggle", wrote Commerzbank analyst Karen Jones, expecting a cap at 1.5907 (61.8% Fibonacci retracement of the April-to-June decline) and support at 1.5724.