GBP/USD drops to fresh weekly lows under 1.3750
- US dollar rises further during the American session across the board.
- GBP/USD down for the third day in a row, heads for the lowest close since August 26.
The GBP/USD dropped further and bottomed at 1.3725, reaching the lowest intraday level since August 27. It then trimmed losses and is attempting to rise back above 1.3750, still sharply lower for the day, about to post the lowest close in almost two weeks.
A stronger US dollar across the board continues to be the key driver in GBP/USD. The greenback is up for the third consecutive day. The DXY gains 0.25% and trades at 92.75, the highest in a week. US bond yields are down for the day but off lows. The 10-year yield is nearing 1.36%, after rebounding from 1.34%.
Economic data released on Wednesday showed the Jobs Openings, and Labor Turnover Survey (JOLTS) reached a record 10.9 million available jobs the US in July. Later the Federal Reserve will release the Beige Book. The key report of the week will be the Producer Price Index on Friday. Also, on Friday, growth and industrial production data are due in the UK.
Back under the 20-SMA
The three-day slide in GBP/USD took the price from weekly highs above 1.3900, back below the 20-day simple moving average (1.3765). The area around 1.3730 is the immediate support that, if broken should lead to a test of 1.3700.
A recovery above the 20-SMA could alleviate the bearish pressure. The next resistance might be seen at 1.3812/15 and then 1.3880.
Technical levels