Cable Faces Tough Resistance at 1.5700

The GBP/USD pair was unable to regain the 1.5700 level on Wednesday, having spent most of the first half of the day consolidating below it.

With no fundamental releases in the UK, the pair fell down to 1.5634 early in the US session, from where it jumped up to the 1.5700 figure following FOMC’s Minutes.

The pair trades a few pips below it after the dust settled, but maintains a generally positive technical tone, as the 1 hour chart shows that the retracement held above a mild bullish 20 SMA, whilst the technical indicators remain above their mid-lines, albeit lacking directional strength.

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In the 4 hours chart, the price also recovered from its 20 SMA that presents a firmer bullish tone, whilst the technical indicators have bounced from their mid-lines and head north, supporting the bullish tone and in line with markets’ sentiment.

Above 1.5700, the pair will meet some intraday resistance at 1.5735, July high, but a break above it should confirm the upward continuation in the midterm.

Meanwhile the GBP/CAD advanced up to 2.0614, boosted by a slump in Canadian dollar, as oil fell to fresh lows on an unexpected increase of US stockpiles.

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The EIA reported that the commercial inventories increased by 2.6 million barrels last week, against expectations of a decline of 1.2 million barrels, with WTI crude oil falling down to $ 40.80 a barrel.

As for the GBP/CAD, the 1 hour chart shows that the price is well above a bullish 20 SMA, whilst the technical indicators are easing partially from extreme overbought levels.

In the 4 hours chart, however, a strong bullish tone prevails, with the 20 SMA leading the way higher and attracting buyers on dips, whilst the technical indicators maintain strong upward slopes well above their mid-lines.

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