Title: GBP/USD Price Analysis: Consolidates below 1.1200 after breaching key daily support line
October 7, 2022 12:26 AM ET
The GBP/USD paused its corrective decline from its three-week high at 1.1495, as investors continue to wait for the US jobs data due on Friday.
Asian markets remain cautious and most currency pairs are moving in narrow ranges without making big bets. The recent string of mixed U.S. data and uncertainty over the Fed's next rate hike are keeping investors on edge.
Meanwhile, the pound remains vulnerable against the dollar as investors assess British Prime Minister Liz Truss' recent speech at the Conservative Party conference on Wednesday. Truss called on the Conservative Party to stick together and transform the economy and the country. Her remarks came after the government announced a U-turn on tax rates on Monday.
From a short-term technical perspective, GBP/USD broke the rising trend line at 1.1193 on a daily closing basis on Thursday.
This suggests that cable bears are likely to extend the ongoing correction at 1.1500.
The 14-day Relative Strength Index (RSI) is below the midline, underpinning the bearish outlook.
A fresh sell-off wave could revive the bears and require a retest of the 1.1100 level on a break of the daily low at 1.1135.
The October low of 1.1085 will be next in sight for sellers.