GBP/USD: Light gains but sellers still in control
The pair is keeping a little higher on the day as the dollar is easing slightly to start the week but the technical picture remains very much unchanged.
Sellers are keeping the downside pressure for the most part but are struggling for a firm daily break under 1.1500 for now. Meanwhile, buyers are unable to seize any form of near-term control with the 100-hour moving average limiting gains for now. That level sits at 1.1795 currently - nearly 150 pips away.
The market will have to weigh up three things in cable this week.
The first, being continued dollar funding pressures (USD positive). The second, being the possibility of the virus spread getting worse and the UK stepping up containment measures - thus shutting down bigger portions of its economy (GBP negative). The third, being that sterling is trading at multi-decade lows and valuations suggest that the downside move may be rather stretched (GBP positive).
It is going to be a tricky one to navigate now that we are down to these levels but at least the technical picture may offer some direction as to where things might be headed moving forward.
A break below 1.1500 will open up yet another slippery slope in the pair, whereas a break back above the 100-hour moving average will be a first key step for buyers to regain some confidence to track a little higher - for now at least.