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GBP/USD – A bearish reversal at a key Fib level?

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  • Fed policymakers sticking to the script
  • US data continues to point to a strong economy
  • Fib rebound may suggest we’ve seen a correction in GBPUSD

It isn’t the busiest week as far as UK and US economic data is concerned but there are still a few pieces worth keeping an eye on. As well as, of course, the scattering of central bank speak.

So far, policymakers appear to remain consistent with the message from the last meeting despite Friday’s surprisingly strong jobs report.

The services PMI on Monday was also far better than expected, further supporting the view that the economy is far from suffering under the weight of high interest rates.

Have we just seen a correction in GBPUSD?

But perhaps it’s the technicals that could prove to be more interesting this week.

GBPUSD Daily

Source – OANDA

On Monday the pair broke below the neckline of a quadruple top formation around 1.26. While it has since pulled back, it could just be a corrective move and the rotation off the 50% Fibonacci retracement level today may support that view.

GBPUSD 4-Hour

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Craig Erlam

Craig Erlam

Former Senior Market Analyst, UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary.

His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News.

Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
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