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Sterling hovering above critical support at 1.5000

FXstreet.com (Barcelona) - The Sterling finished the day sharply lower, closing down 100 pips at 1.5034 and sitting just above the critical support level of 1.5000 which has halted declines over the past two weeks.

According to Val Bednarik of FXStreet.com, “the GBP/USD failed again at the 1.5130 level falling heavily in US hours down towards current levels and maintaining a strong bearish momentum according to the hourly chart, as indicators head south below their midlines while 20 SMA gains bearish slope above current price. In the 4 hours chart technical readings also support a downward continuation, with immediate support not around 1.5013, past week low. An acceleration below 1.5000 key psychological figure, should expose the 1.4920 next strong support today.”

The longer term time frame technical picture continues to break down as well, which may help limit advances in the coming sessions. Short term moving averages remain in bearish set up, with price located below both the 9 and 20dma’s. Furthemore, the RSI (14) has once again broken beneath the 40 level, confirm the bearish zone between 60 and 20 remains intact which could also help influence a “sell the rally” mentality as the day progresses.

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