The Pound fell sharply in late trade last week after the Bank of England (BOE) signaled an end to its monetary policy tightening after raising interest rates by 50 basis points at its latest meeting.
While the US dollar, which weakened briefly during the FOMC meeting's decision, finally managed to close last week's trading strongly following the publication of the United States (US) NFP employment data report which was surprisingly published with encouraging figures.
Thus, the price movement on the chart of the GBP/USD currency pair has shown a continuous downward pattern at the opening trade earlier this week.
On Friday, the daily decline was recorded up to 200 pips, but on Monday yesterday the momentum returned slowly with price movement only in the range of 70 pips.
After falling past the 1.21000 level last week, the price slipped lower yesterday and hovered above the 1.2000 price support zone.
Although a slight increase was displayed in the Asian session this morning (Tuesday), the price is still moving in a bearish trend where the price is below the barrier level of the Moving Average 50 (MA50) on the 1-hour time frame on the GBP/USD chart.
Further declines will be expected for prices to break through the 1.2000 zone continuing last week's downtrend and heading towards some previous focus levels.
The level around 1.19400 will be tested before the price continues its decline towards support around 1.18800.
However, if there is a rebound, the price that crosses the 1.21000 level and also the MA50 barrier will signal a change in trend again.
The rise will continue towards the SBR (support become resistance) zone at 1.22000 and potentially rise higher again.
