GBP/USD extends the Asian recovery to reclaim 1.2900
|The bulls appear to face exhaustion after the Asian bounce, leaving the GBP/USD pair in a phase of consolidation sub-1.29 handle, as we progress towards the European opening bells.
GBP/USD eyes on 1.2930 – key resistance
Despite, widespread risk-aversion witnessed in the Asian trades, the GBP/USD stood resilient and embarked upon a tepid-recovery from a dip to 1.2864 lows. Risk-off sentiment drove the Asian markets today, as the overnight Barcelona ‘Terror Attack’ spooked investors.
The recovery in Cable was largely on the back of fresh selling seen in the US dollar against its main competitors, as the US political concerns continue to loom, with the latest CNN headlines reporting that the US President Donald Trump ends plans for his Council on Infrastructure
Further, the pound continues to cheer better-than expected UK retail sales data. The UK’s retail volumes came in at 0.3% in July m/m, while the annualized retail spending dropped sharply to 1.3%. Markets had estimated a 0.2% reading on a monthly basis; while a 1.4% print was expected on yearly basis.
Later today, the spot will remain at the mercy of persisting risk trend and sentiment around the greenback amid a data-empty UK docket. Meanwhile, the latest Bloomberg article citing that the BOE Carney is going off script with regard to plans for a rate hike, could keep the recovery in check ahead of the US data and Fedspeak.
GBP/USD levels to consider
Haresh Menghani, Analyst at FXStreet writes: “On daily chart, any attempted up-move beyond the 1.2900 handle is being sold into. Even if the pair is able to sustain above the mentioned hurdle, further up-move is likely to confront fresh supply near 1.2930 confluence resistance - comprising of 50-day SMA and 50% Fibonacci retracement level of 1.2589-1.3269 recent up-swing.”
“On the flip side, bears would be targeting for a decisive break below 1.2850-40 strong support (100-day SMA and 61.8% Fibonacci retracement level), which if broken would turn the pair vulnerable to extend its near-term corrective slide even below the 1.2800 handle towards its next support near 1.2775 area,” Haresh adds.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.