Gbpusd Downtrend Intensifies

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Gbpusd Downtrend Intensifies

Gbp/Usd Downtrend Intensifies

The downtrend of GBP/USD has intensified as the pair has lost the 1.2700 support. Now, the same level (1.2700) is acting as support amid an increased buying interest in the USD.

The US Dollar has once again assumed the driving seat after the release of the US CPI. Additionally, the Fed member 'Logan' also passed hawkish comments.

Gbp/Usd Under Grasp Of Bears

The daily chart of GBP/USD shows that the bears are in charge as the pair is already below all the key levels. The recent movement in the GBP/USD has also pushed the pair below the 200 EMA.

This means the 1.2868 handle is now acting as a dynamic resistance as the 200 EMA is present there. There's no doubt that the GBP/USD is now driven by the bears as even the 50 EMA is now above the trading price.

The MACD indicator also confirms that the trend is now bearish, as the signal line is now above the MACD line. Also, both lines of the MACD indicator are now in the negative area.

Given the recent price action and bearish pressure, there's a good chance that GBP/USD is now heading towards the next support at 1.2700.

break of 1.2700 could open the chances of a revisit to 1.2600, which is also a key support for the GBP/USD. On the flip side, a break above the 200 EMA on the daily chart will negate some of the bearish pressure.

break above 200 EMA will also start a new consolidation phase in the GBP/USD as the pair tries to find its next direction.

Right now, the path of least resistance for the GBP/USD is a downside in the short term. Also, the recently released UK labor data showed an increase int he wage growth.

Improvement in wage growth will translate into higher inflation levels in the UK. In turn, this could hinder the BoE's plan to lower the policy rate.

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