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GBP/USD edging closer to 1.24 this morning

It would be wrong to blame the lower US yields for the rise in the GBP/USD on Friday to its best level since September 20. That is because UK gilt yields fell by slightly more than their US counterparts. That said, the acceleration in the GBP/USD came after it busted above its 50 day moving average (then at 1.2304). The pound later topped out at 1.2390 and later closed in the US at 1.2380. Such was the gain, that despite the USD/JPY falling below 149.25 at one stage, the GBP/JPY price was able to rise above 185 and that is something it has not achieved since the September 6. The next important level for the GBP/USD, should this rebound extend, is now the 200 day moving average. That is in place this morning at 1.2435. There is also still a double top in place on the daily charts just ahead of that, from the peaks on September 19 (1.2425) and September 20 (1.2421). It was that double top that led the pound down to its most recent lows at 1.2037. Beyond 1.2435 lie Fibonacci correction levels at 1.2459 (38.2% of 1.3142-1.2037) and then at 1.2589 (50% of the same). The GBP/USD has just now hit a session high at 1.2387
 

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