GBP/USD back below 1.3200, erases post-Yellen gains

GBP/USD dropped almost a hundred pips from daily highs, falling below the level it had before Janet Yellen speech.

The pair jumped to 1.3278, hitting the highest level in three weeks but then retreated sharply amid a recovery of the US dollar across the board. Currently, it trades at 1.3190, around the same level it closed yesterday and in the middle of today’s price range.

GBP/USD bullish case weakens

Short-term momentum now appears to be favoring the US dollar with the price below the 20-hour moving average that stands around 1.3205. Volatility remains elevated as market digest Yellen’s words. She mentioned that the case for a rate hike has strengthened.

Despite falling versus the US dollar, the pound rose marginally against the Swiss franc and the euro after Yellen speech.