While the Euro showed excellent performance yesterday, the opposite happened to the currency Pound Sterling when it was traded back down against the US dollar.
The pound is seen to have failed to maintain its strengthening momentum last week until it continued earlier this week when the US dollar was still moving erratically heading into the FOMC meeting.
Pound investors are also cautious ahead of the Bank of England (BOE) policy meeting on Thursday tomorrow while in today's European session, the focus will first be on the release of UK inflation data.
If you examine the price chart of the GBP/USD currency pair, the price has displayed a downward pattern yesterday around 100 pips.
Starting from the 1.22800 level at the start of the Asian session yesterday, the price has dropped to 1.21800 before rebounding slightly to close the New York session.
The decline exhibited was seen to retest the RBS zone (resistance become support) 1.22000 as expected by analysts.
Although the price bounced back slowly above the zone, the price movement that has started to be below the Moving Average 50 (MA50) barrier on the 1-hour time frame on the GBP/USD chart invites an early signal of an imminent bearish trend change.
The situation will be clearer if the price drops below the RBS 1.22000 zone before extending the decline to 1.21000.
Next, the 1.2000 concentration zone will again be the target for a continued decline like the situation that happened last week.
However, if the price manages to bounce back higher from the 1.22000 zone, the resistance at the 1.23000 zone will come back into focus to be tested once again.
The price is likely to record another recent high for the 7-week trading period.
