GBPUSD Technical Analysis – 13th February 2013 – FX Price Action Update
- The GBPUSD pair moved to a 6-month low around 1.5570 during early trading on Tuesday, on softer than expected UK CPI data, but subsequently pared back earlier losses to end the day near the open.
- Cable had likewise moved under the long term ascending trend line, before the move back to the daily opening level, potentially trapping shorts if the corrective move gathers momentum going forward (see fig 2 chart).
- The ADR for Tuesday came in at 121% of the average of 60 days, and an associated 100 pips.
- Price has closed the day as a daily timeframe pinbar/doji candle. This does however come in the context of a strong downtrend – as the British pound has been the second worst performer (following the yen) amongst currency majors, when referencing recent currency correlation strength charts.
- If the pound/dollar pair can see a continuation of the intra-day move higher the 1.5750 area is a potential trouble area with the 23.6% Fibonacci and price pivot zone aligned.
- A break below Tuesdays low would negate the pinbar and open up further potential downside.
- We also note that the BOE Inflation report on the 13th February brings a significant near term event risk.
GBPUSD – D1 – fig 1
GBPUSD – W1 -fig 2