GBP/USD pauses after 100-pip rally

By FXstreet.com | Updated July 30, 2014 AAA

FXStreet (Córdoba) - The rally of the GBP/USD that has extended over the last sessions found an interim top at the 1.6840 zone, stalling a few pips shy of this month’s high.

The GBP/USD extended gains into a second day after upbeat UK employment figures lifted the pair back above 1.6800. However, the Cable lost momentum after a 100-pip advance within the last 2 days, as investors gear up for the next series of US indicators, including jobless claims and retail sales.

At time of writing, the GBP/USD is trading at the 1.6820 zone, recording a 0.2% gain Thursday, having scored a 1-week high of 1.6838 in recent dealings.

GBP/USD technical outlook

Valeria Bednarik, chief analyst at FXStreet, notes that GBP/USD has broken above a descendant trendline coming from this year high of 1.6996 and short-term charts show a strong bullish momentum.

“Price however is pulling back some towards the broken trend line, currently at 1.6810 and immediate support: below it, price may extend its slide towards mentioned 1.6770 level, while if this last gives up, 1.6735 is next support to consider”, said Bednarik. “To the upside, an acceleration above mentioned 1.6845 high should open doors for continued gains, looking then for a quick test of 1.6890 price zone, and higher towards 1.6920 critical resistance level”.

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