#GBPUSD @ 1.13204 The pound attempts to extend below 1.1300 on retreat from 1.1445. (Pivot Orderbook analysis)

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• The pound attempts to extend below 1.1300 on retreat from 1.1445.
• Investors scale down hopes of aggressive BoE tightening.
• GBP/USD might decline towards the mid-1.11s – Scotiabank.

The pair currently trades last at 1.13204.

The previous day high was 1.144 while the previous day low was 1.1171. The daily 38.2% Fib levels comes at 1.1337, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.1274, expected to provide support.

The pound is giving away gains on Tuesday, following a 1% rally on Monday as the UK Government ditched most of the tax cuts plan announced in September. The sterling us testing prices sub-1.1300 on retreat from Monday’s highs at 1.1445.

UK finance minister’s U-turn on the controversial mini-Budget plan has dampened hopes of aggressive monetary tightening by the Bank of England. This has discouraged GBP buyers, which has been one of the main reasons behind Tuesday’s reversal.

Earlier in the day, the pound saw some positive price action after the Financial Times reported that the Bank of England might be considering delaying the start of its quantitative tightening (QT) gilt sales from the scheduled date of Oct. 31, after having already delayed it from Oct. 6.

The Bank, however, denied the Financial Times ‘report later on. The BoE assured that they do not contemplate any postponement of the start of government bonds’ sales, which has sent the GBP lower again.

FX analysts at UBS Scotiabank maintain their negative outlook on the pair, pointing out to targets below 1.1200: “Intraday support in the upper 1.12s is coming under pressure. Below here, cable risks dipping back to the mid-1.11s (…) Political and economic risks for the GBP remain elevated.”

Technical Levels: Supports and Resistances

GBPUSD currently trading at 1.1317 at the time of writing. Pair opened at 1.1356 and is trading with a change of -0.34 % .

The pair is trading above its 20 Daily moving average @ 1.1135, below its 50 Daily moving average @ 1.15 , below its 100 Daily moving average @ 1.1835 and below its 200 Daily moving average @ 1.2467

The previous day high was 1.144 while the previous day low was 1.1171. The daily 38.2% Fib levels comes at 1.1337, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.1274, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 1.1204, 1.1053, 1.0936
• Pivot resistance is noted at 1.1473, 1.1591, 1.1742

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