GBP/USD fresh 7-week lows, BoE comments weigh

By FXstreet.com | July 31, 2014 AAA

FXStreet (Córdoba) - The GBP/USD extended the decline and fell to fresh 7-week lows sub-1.6900 Thursday, weighed by broad USD strength and dovish comments from a BoE official.



The GBP/USD broke below another important support at 1.6882 (61.8% Fibo of 1.6692/1.7190) and scored a low of 1.6869 so far. The pair is now moving toward the 100-day SMA that stands as next major support at 1.6855.



The Cable has fallen more than 300 pips since peaking at 1.7190 mid-July, as investors unwind long positions amid prospects the BoE won't hike rates before year-end. BoE Deputy Governor Ben Broadbent said Thursday rate rises to be "gradual and limited" and the pound might be "overvalued", echoing comments from the IMF.



GBP/USD technical levels



As for technical levels, next supports are seen at 1.6855 (100-day SMA) and 1.6800 (psychological level). On the other hand, resistances could be found at 1.6954 (Jul 30 high), 1.6970 (50-day SMA) and 1.7000 (psychological level/Jul 28 high).



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