British Pound Forecast: GBP/USD Falls to Fresh Monthly Low
GBP/USD extends the decline from the start of the week to register a fresh monthly low (1.3308).
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British Pound Outlook: GBP/USD
GBP/USD extends the decline from the start of the week to register a fresh monthly low (1.3308), and the weakness in the exchange rate may persist as a head-and-shoulders formation seems to be taking shape.
British Pound Forecast: GBP/USD Falls to Fresh Monthly Low
Keep in mind, GBP/USD failed to defend the June low (1.3371) after closing below the 50-Day SMA (1.3530) for the first time since April, with the depreciation in the exchange rate pushing the Relative Strength Index (RSI) toward oversold territory.
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The developments indicate a potential change in trend as GBP/USD no longer responds to the positive slope in the moving average, and the weakness in the exchange rate may carry into August as it appears to be completing a key reversal pattern in July.
With that said, GBP/USD may continue to give back the rebound from the May low (1.3140) as it carves a series of lower highs and lows, but the exchange rate may consolidate over the remainder of the week should it snap the bearish price series.
GBP/USD Price Chart – Daily
Chart Prepared by David Song, Senior Strategist; GBP/USD on TradingView
- GBP/USD falls to a fresh monthly low (1.3308) as it extends the decline from the start of the week, and a close below 1.3310 (100% Fibonacci extension) may push the exchange rate toward 1.3210 (50% Fibonacci extension).
- Next area of interest comes in around the May low (1.3140), with a move/close below the 1.3140 (78.6% Fibonacci extension) to 1.3150 (23.6% Fibonacci extension) region opening up 1.3010 (61.8% Fibonacci extension).
- However, lack of momentum to close below 1.3310 (100% Fibonacci extension) may curb the bearish price series, with a move above the 1.3410 (78.6% Fibonacci retracement) to 1.3460 (23.6% Fibonacci extension) area bringing 1.3650 (38.2% Fibonacci extension) on the radar.
Additional Market Outlooks
AUD/USD Fails to Test November High Ahead of Australia CPI
Canadian Dollar Forecast: USD/CAD Approaches Monthly High
EUR/USD Rally Unravels Ahead of Monthly High
USD/CHF Bounces Back Ahead of Monthly Low
--- Written by David Song, Senior Strategist
Follow on Twitter at @DavidJSong
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