GBP/USD headed to 1.3050 on risk-recovery and subdued DXY?
|The GBP/USD pair regained footing in the Asian session this Monday, as the bulls cling onto 1.3000 support, gearing up for a big week ahead.
GBP/USD: Immediate focus on UK CPI, US retail sales
The spot is on the front foot so far this session, as improving risk appetite amid beliefs that the North Korean tensions may have peaked, offers some support to the risk currency GBP.
More so, persistent weakness seen in the greenback against its main competitors also remain supportive of the GBP/USD pair, in the wake of Friday’s US CPI disappointment, which weighs negatively on the Fed rate hike expectations for this year.
However, it remains to be seen if the major can sustain the Asian bounce towards 1.3050 levels, following disappointing Chinese data dump, which could keep the investors on the edge.
Moreover, further upside may also remain capped, as the GBP traders continue to weigh the mixed UK macro data released last week, as they brace for more key economic releases due in the week ahead. Tuesday’s UK CPI and US retail sales data now remain on sight, in absence of any economic updates from both the UK and US today.
UK industrial production returns to expansion in June, a big beat on expectations
UK June trade data disappoints across all indicators
GBP/USD levels to consider
Valeria Bednarik, Chief Analyst at FXStreet noted: “In the 4 hours chart, the pair settled above its 20 SMA, and around the 200 EMA, while technical indicators lack directional strength within neutral territory, indicating a limited upward potential. The pair topped for the week at 1.3030, the immediate resistance, but it would take an advance beyond 1.3060 to revert, at least short-term, the negative stance. Support levels: 1.2985 1.2950 1.2910 Resistance levels: 1.3030 1.3060 1.3095.”
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