GBP/USD: Technical Analysis For January 6, 2014

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The Great Britain Pound fell against the greenback to fresh lows during today’s trading session as expectations for a U.S. rate hike  this year continued to lend broad support to the greenback. The Fed is widely expected to raise interest rates mid this year as the steady economic recovery in the U.S. continues.


Elsewhere, sterling was struggling near 17-month lows after data showing a slowdown in construction activity in the U.K. last month underlined expectations that the Bank of England will keep rates on hold for most of 2015.


However technical analysis shows that there seem to be a price rejection on a demand zone on the daily chart which suggests that the currency pair might be in oversold mode, which resulted in a Hammer price formation.


Trading Recommendation:

Only take buy trade at the break and close of 1.53180 resistance

Only take Sell trade at the break and close of 1.51768 support

Tomorrow morning investors would be monitoring the Great Britain Services PMI.

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