GBP/USD Forecast: upbeat UK PMI to help build on last week's goodish rebound
|On Friday, the GBP/USD pair reversed an early dip to mid-1.3200s and regained positive traction for the third consecutive session. The up-move was backed by a combination of supportive factors, with traders also shrugging off better-than-expected US monthly jobs report. The British Pound got a boost from upbeat UK manufacturing PMI, which coupled with news of a possible solution over the Northern Ireland border issue remained supportive of the pair's rise to fresh weekly highs.
With investors looking past Friday's stronger NFP print, renewed trade war fears and expectations of some retaliatory measures over the latest US steel and aluminium tariffs prompted some fresh US Dollar selling at the start of a new trading week. The pair built on last week's goodish rebound from 6-month lows and traded with a mild positive bias for the fourth consecutive session as market participants now look forward to the release of UK construction PMI for some fresh bullish impetus.
From a technical perspective, short-term technical indicators are still holding in bearish trajectory and the pair has also moved away from near-term oversold conditions. Hence, a disappointing UK data might prompt some fresh selling and turn the pair vulnerable to resume with it prior depreciating slide. However, a convincing move back above the 1.3400 handle has the potential to continue lifting the pair further towards its next hurdle near the 1.3465 region, marking 38.2% Fibonacci retracement level of the 1.1987-1.4377 up-move.
On the flip side, any meaningful retracement back below mid-1.3300s now seems to find immediate strong support near the 1.3300 handle, which if broken could accelerate the fall further towards 1.3250 horizontal support before the pair eventually heads back towards challenging the 1.3200 handle.
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