GBP/USD bounces off dismal UK retail sales-led slide to sub-1.2400 level
|The GBP/USD pair has managed to recovery around 30-35 pips from disappointing UK retail sales data-led slide to sub-1.2400 handle and is currently trading around 1.2425 region.
After once again failing to sustain its move above 1.2500 mark, for the second consecutive day, the pair ran through fresh offers on Friday following an unexpected drop in the UK retail sales. In fact, sales volume fell 0.3% in January and for the second month running was much lower-than-consensus estimates, which pointed to a 1.1% growth for January.
In addition to this, December figures were revised to show a 2.1% decline as compared to 1.9% contraction reported earlier. Furthermore, core retail sales, which exclude automobile sales and fuel, also fell short of 0.7% growth expected and fell 0.2% in January.
Meanwhile, a modest US Dollar recovery also collaborated to some renewed selling pressure around the major.
From the US, the release of CB's leading index for January might provide some impetus during NA session.
Technical outlook
Valeria Bednarik, Chief Analyst at FXStreet notes, "the weekly low stands at 1.2382, with a break below it exposing 1.2345, the 50% retracement of the same rally and this month low. An extension below 1.2330 should confirm further declines towards the 1.2280/90 price zone."
"The pair has an immediate resistance at 1.2480/90, followed by the 1.2540 region. It would take a break above this last, something quite unlikely, to see the pair reversing the negative tone."
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