Analysts are beginning to weigh in on early expectations of a change in direction for the US dollar's currency movement after showing a sluggish performance throughout the week.
The United States (US) gross domestic product (GDP) data for the third quarter published in the New York session last night has changed expectations for the Federal Reserve (Fed) to continue aggressive policy tightening for the remaining two meetings this year.
This initial strengthening signal for the US dollar is seen to put pressure back on the previous strengthening pattern of the Pound which received positive momentum from the appointment of Rishi Sunak as the new UK Prime Minister.
Investors will await the results of the central bank of England (BOE) and FOMC policy meetings next week for clearer direction for the two currencies.
Assessing the price action on the chart of the GBP/USD currency pair, the pattern displayed was more flat on Thursday yesterday after jumping over 200 pips for 2 consecutive days.
The price hovering in the resistance zone of 1.16500-1.16000 is seen to move slightly down to around 1.15500 until yesterday's New York session.
Continuing trading in the Asian session this Friday morning, the price hovered at the support level of the Moving Average 50 (MA50) on the 1-hour time frame on the GBP/USD chart which will be an assessment for investors for further price direction.
If the price is still able to maintain the upward movement as before, passing the important zone of 1.16000 will then expect an increase until it reaches the height of 1.18000.
Reaching that level has recorded the latest price high for the 9-week trading period.
On the other hand, if the price drops below the MA50 support level in addition to a stronger US dollar pushing the Pound, the price can drop towards the concentration zone at 1.15000.
A clearer signal for a change in the bearish trend would expect the price to continue its decline to the previous concentration level around 1.13000 or 1.12000 again.
