GBPUSD continues in decline

 

The recent rally in the American dollar has put weight on other currencies. Just like many of its peers, the British pound started a decline too. The GBPUSD pair hit a three year old resistance level (A) few weeks ago and couldn´t rise back to that level since then.

The course bounced back from the 50 moving average but rose only to the 1.4000 level when the bears stepped in again. It fell back to the 50 EMA and challenging the previous low at 1.3777 (B). The Relative Strength Index is also showing a descending trend. Should the cable (GBPUSD´s nickname) fall below the 50 EMA and its previous low, it would break the rising trend on the daily chart and put more pressure on the pair. It could fall to the support level around 1.3170 -1.3100 (C), and further below the 1.2950 -1.2850 zone (D) could provide some ground for the bulls.

On the other hand, if the 50 EMA proved to be a strong support again, it could send the course higher again and test the long term resistance level (A) for the second time.