GBP/USD: headed back to 1.4000 key figure?
|- GBP/USD is back on the march.
- GBP/USD is supported ahead of Friday's retails sales data.
GBP/USD has continued higher as the dollar continues to lose traction within a day range of 90.4160-90.9830 in the DXY. Currently, GBP/USD is trading at 1.3904, up 0.35% on the day, having posted a daily high at 1.3915 and low at 1.3805.
GBPUSD was supported at 1.3820 in Europe and the pound has not looked back until 1.3890 to 1.3855 support before a bounce to aforementioned highs.
As analysts at Scotiabank explained, GBP is outperforming most of the G10 currencies. "Fundamental releases have been limited however near-term risk is elevated ahead of Friday’s retail sales. Recent developments favor EURGBP weakness, given the contrast between constructive BoE comments and renewed concerns ahead of next week’s ECB," the analysts explained.
US government going to shutdown?
Meanwhile, the US docket has been pretty busy on Thursday with the release of housing market data, Philly Fed Manufacturing Index and weekly initial jobless claims that painted a mixed picture of the US economy while jitters remain over the possibility of a government shutdown but it seems that the market is convinced that Congress will do the right the 'right thing'. However, the House is to vote later today and Trump warned that the US government "could very well" shut down. The latest is that Ryan said he's confident House will pass a short-term spending bill, offering some support to the dollar.
GBP/USD levels
GBP/USD is back on the path towards 1.4000 despite the various intraday divergences noted earlier by analysts at Commerzbank who argue that GBP/USD is immediately bid above the 1.3495 2 month uptrend. "We would allow for a retracement to 1.3730/1.3600 ahead of further gains," the analysts explained.
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