GBP/USD flips o bears eye breakdowns of 200-D SMA and 50-W SMA

• GBP/USD: market gets back to the trend and that is down, eyes on a test of 200-D SMA.
• GBP/USD: below 200-D SMA, bears can target the 50-W SMA at 1.3412.

GBP/USD was initially bid post the FOMC outcome but the bears have got back involved at cheaper levels aiming for an attack on the 200-D SMA at 1.3534. Currently, GBP/USD is trading at 1.3560, down -0.39% on the day, having posted a daily high at 1.3668 and low at 1.3555.

Sterling is making fresh daily lows as the market flips over after the Fed left rates on hold and made minor adjustments to the statement. Initially, the dollar was sold off when investors covered longs after there were no nods to a rate hike in June.  The US 10's slipped to a session low of 2.96 and the dollar subsequently fell from 92.6800  to the midpoint of its prior range of between 92.2230-92.7180. That range has just been extended on the ask to 92.8240 as traders move on from a benign outcome of the Fed and get back to underlying factors that have determined the recent ranges and trajectory of markets - (Fed sees inflation moving to target, expected to run near target in the medium-term, nothing new for the markets there).

Eyes on the BoE and services data

The BoE is up next week and that trade continues to unwind as bets come off the table for rate hike considering the breakdown of sustained economic growth in the UK. Traders will now look to the UK's services data and bulls prey for a healthy outcome. (The  UK construction PMI beat was shrugged off by traders earlier, it was the first bit of good news in a fortnight).

GBP/USD levels

The pound remains below the descending 50-hr SMA at 1.3667 and triple hourly top at 1.3665, and indeed the correction from 1.3580 lows was shallow. Blow the 200-D SMA at 1.3534, this key week reversal targets 1.3694/58 ahead of the 1.3412 50-W SMA.