GBP/USD holds above 1.3700, near multi-year highs
|- Pound outperforms on Thursday while DXY hits fresh one-week lows.
- GBP/USD heads for the highest close since April 2018.
The GBP/USD pair rose earlier on Thursday to 1.3745, the highest level since April 2018. It then retreated, finding support above the 1.3700 zone. It is hovering around 1.3725, holding onto daily gains.
The key driver continued to be risk appetite and a weaker US dollar. The DXY dropped to 90.04, the lowest level since January 13. Better-than-expected economic data from the US did not help the dollar.
Higher US yields kept dollar’s losses limited. The 10-year yield rose to 1.12% before pulling back to 1.10%. In Wall Street, equity prices are mixed. The Dow Jones is flat while the Nasdaq rises by 0.49%.
The pound is outperforming on Thursday although it lost some strength around the ECB press conference. On Friday, retail sales data is due in the UK. Also, European PMIs will be released.
From a technical perspective, GBP/USD holds a firm bullish tone, particularly while above 1.3700. A decline below could be followed by a correction or a consolidation phase. On the flip side, a close below the 20-day moving average at 1.3590 would open the door to more losses.
Technical levels
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