GBP/USD analysis: still ranging, but upward exhaustion becoming evident
|GBP/USD Current price: 1.2464
The GBP/USD pair fell to a daily low of 1.2401 on the back of dollar's broad strength, but trimmed all of its daily loses and closed the day flat around 1.2460. Data coming from the UK showed that public sector net borrowing (excluding public sector banks) decreased by £13.6 billion to £49.3 billion in the current financial year-to-date (April 2016 to January 2017), compared with the same period in the previous financial year, being this is the lowest year-to-date borrowing since the financial year-to-date ending January 2008. Public sector net borrowing (excluding public sector banks) was in surplus by £9.4 billion in January 2017, a £0.3 billion larger surplus than in January 2016; this is the highest January surplus since 2000. Also, BOE´s Governor Carney testified before the Treasury Committee this morning, reiterating that the Bank is open to move rates one way or the other, if deemed appropriate. The technical picture maintains the neutral stance seen on previous updates, although lower highs, well below the 1.2540 region, increase the bearish potential. In the 4 hours chart, the price keeps moving back and forth around a horizontal 20 SMA while technical indicators barely entered positive territory before turning flat. At this point, the pair needs to break below 1.2345, February low, or above the mentioned 1.2540, the 23.6% retracement of its latest bullish run, to gain some directional traction.
Support levels: 1.2430 1.2380 1.2345
Resistance levels: 1.2480 1.2530 1.2565
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