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GBP/USD capped by 1.5900 after 1-year low

FXStreet (Córdoba) - Following a corrective phase, GBP/USD resumed the slide Wednesday and fell to fresh 1-year lows weighed by below forecast UK data and broad USD strength.

UK services PMI came in below expectations and added to the manufacturing and construction figures, the composite PMI printed 55.8 in October, its lowest level since May 2013.

Cable suffered on the back of the data and broke below the 1.5900 level to hit a 1-year low of 1.5868 during the European session. However, GBP/USD found support and bounced, but the recovery remained capped by the psychological level. At time of writing, the pair is trading at 1.5890, recording a 0.69% loss on the day.

GBP/USD short-term outlook

Valeria Bednarik, chief analyst at FXStreet, notes a predominant bearish tone and said the pair may extend its decline down to 1.5830, September 12th 2013 daily high, with next support at 1.5780. “Upward corrections to 1.5930/50 price zone are likely to attract sellers, with only steady gains above the highest, not seen for today, reverting the bearish tone of the pair”.

GBP/USD strongly down since early opening - FXStreet

FXStreet Chief Analyst Valeria Bednarik points out that GBP/USD has been extending losses on Wednesday which accelerated after the poor UK Services data for October.
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