Pound knocked out by the Inflation report - FXStreet

FXStreet (Barcelona) - Valeria Bednarik, Chief Analyst at FXStreet notes that Pound was knocked by UK Quarterly Inflation Report seeing inflation below 1% over the upcoming six month and at more reasonable levels in three years.

Key Quotes

“The GBP/USD lost over 100 pips after surviving a mild weak employment report, showing wages ticking up.“

“At this point, the short term picture seems a bit overstretched to the downside, with 1 hour indicators in oversold territory, yet far from suggesting an upward correction.”

“In the 4 hours chart the pair broke below a flat 20 SMA but momentum stalled above 100 whilst RSI continues heading strongly south in negative territory.”

“Chances of an upward recovery seem now limited by immediate resistance around former lows at 1.5820/30, while towards the downside, the pair has a strong long term static support area around 1.5770, with a break below anticipating a stronger decline for the upcoming days.”