GOLDWELL：Daily Market Recap – GBPUSD The British Pound Could Return To $1.30

After

several months of consolidation, the GBPUSD looks set for a bearish

reversal. The pair broke out of its long-term range on Thursday, paving

the way for a bearish reversal to 1.30. Looking ahead to this week the

Jackson Hole symposium will be crucial.

Indeed,

the dollar has been strengthening since the release of the Fed's

"Minutes" on Wednesday evening, as market participants are almost

certain that central bank officials will announce a reduction in the

number of asset purchases (tapering) at the next meeting in September or

at the October meeting, for a start of tapering before the end of the

year.

From

a technical perspective, the GBPUSD's exit from its range is a

technical signal for a bearish reversal. We can expect the bearish

momentum to accelerate over the next few sessions and weeks until the

exchange rate reaches the lower range near $1.30. Traders may look to

short the pair at the start of the week with a target for the July low.

The

July low of $1.35716 will be the immediate support to watch. If the

GBPUSD bounces off this level and a clear return to the range occurs,

the bearish outlook would be invalidated. The pair will have then formed

a rough head and shoulders pattern which may trigger investors to push

the rate higher. The outlook would become bullish if the bearish oblique

through the May and July highs is breached.

Disclaimer:

This material has been created for information purposes only. All view

expressed in this document are my own and do not necessarily represent

the opinions of any entity.