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The GBP/USD is in full-correction mode, down over 40 pips on the session. The move is a bit unexpected in the wake of the Bank of England (BOE) statement that all banks have passed its “stress test” for the first time since the 2008-2010 global financial crisis. However, that is often the case with fundamentals-each one is not discounted rationally.

Perhaps the largest newsmaker for the U.S. session has been FED Chair nominee Jerome Powell’s comments. Citing the need to raise interest rates “gradually” to ensure maximum employment and pricing stability, Powell has injected a newfound confidence in the USD.

 

GBP/USD Technicals

Since Brexit, trading the GBP/USD has been a wild ride. The long-term analytics present a challenging picture, to say the least. But, volatility can be a beautiful thing. Today’s trade of the GBP/USD has brought several support levels into play.

GBP/USD, Daily Chart

Here are the key support levels for the remainder of the U.S. session:

• Support(1): Bollinger MP, 1.3227

• Support(2): 62% Fibonacci retracement, 1.3184

• Support(3): Daily SMA, 1.3157

Bottom Line: As of now, the GBP/USD is pushing daily lows. I have buy orders in the queue from the 62% retracement of the current wave(1.3184). The intraday trend is heavily bearish, so a 1:1 R/R strategy looking for an initial positive move of 10-15 pips is the play here.

Fading trends is not for the faint of heart. For now, the Bollinger MP is holding nicely as support. In the event that the 62% retracement comes into play today, be sure to manage risk aggressively and take the available pips.