GBPUSD bounces off 200-SMA ahead of UK PMIs
GBPUSD snapped a three-day winning streak the previous day as the UK’s Autumn Statement failed to impress Cable buyers despite offering tax cuts and higher wages. The reason could be linked to the mixed economic outlook for Britain and a corrective bounce in the US Treasury bond yields. However, the 200-SMA defends the Pound Sterling buyers so far on the Thanksgiving Holiday in the US, as well as ahead of the UK’s release of preliminary S&P Global/CIPS PMIs for November. It’s worth noting, that the upbeat RSI (14) line and the bullish MACD signals enable the pair buyers to keep the reins within a one-month-old rising channel, currently between 1.2330 and 1.2620. However, the RSI conditions are nearly overbought and hence the late June’s low and May’s peak, close to 1.2590 and 1.2680 in that order, appear tough nuts to crack for the bulls past 1.2620.
Meanwhile, a daily closing beneath the 200-SMA level of 1.2450 needs validation from the downbeat prints of the UK PMIs to lure the GBPUSD sellers. Even if the quote slides beneath the 1.2450 key SMA support, the aforementioned bullish channel’s bottom line of around 1.2330 will challenge the Cable bears. It’s worth noting, however, that the Pound Sterling’s rejection of the bullish chart pattern, by a daily closing below 1.2330, will make it vulnerable to drop towards the previous monthly low of around 1.2035 and then to the 1.2000 psychological magnet, before targeting the yearly low of around 1.1800.
