Pound Eyes 1.5220 As Bears Remain In Control
The GBP/USD pair closes the day at its lowest level in 3-months, having been as low as 1.5299 during the American afternoon.
The Pound was weighed by the poor performance of the UK manufacturing sector, as the August PMI dipped to 51.5 from previous 51.9, whilst Britain’s broad money, M4, increased by £8.4B in July, compared to the average monthly increase of £5.1 billion over the previous six months, all of which suggest the economic recovery is starting to slowdown.
Additionally, the GBP was unable to attract buyers on a risk aversion environment, and seems poised to extend its decline during the upcoming sessions, as the 1 hour chart shows that the 20 SMA maintains a clear bearish slope above the current level, whilst the technical indicators consolidate well below their mid-lines.
In the 4 hours chart the 20 SMA has capped the upside earlier in the day and stands now at 1.5385, the Momentum indicator lacks directional strength below the 100 level, but the RSI indicator heads lower near 32, supporting the ongoing bearish tone.