- GBP/USD collapse extended last week
- Slow Stochastics still in oversold territory, MACD still trending sharply lower
- Bounce possible off minor support in the 1.6550 range, but medium-term bias still lower
The GBP/USD gapped higher to start last week, but the price action was consistently bearish after that, with the pair dropping to a new 4-month low after Tuesday’s disappointing CPI report; even a surprisingly hawkish vote in the BOE minutes was unable to stem the bleeding. As we roll into a new trading week, the pair is testing the bottom of its bearish channel and deeply oversold according to the Slow Stochastics indicator. Traders will be watching for a bounce of minor previous Fib extension/previous support at 1.6550, but any rallies may be limited in nature, just as we saw last week.