GBP/USD remains vulnerable below 100-DMA, dovish BOE weighs
|- GBP/USD remains pressured by dovish BOE, Delta plus covid strain woes.
- Thursday’s closing below 100-DMA keeps the sellers hopeful.
- The cable ignores the US dollar’s weakness ahead of PCE inflation data.
GBP/USD is struggling to resist above the 1.3900 level, as the Bank of England’s (BOE) dovish surprise continues to undermine the sentiment around the pound.
The persistent sluggish moves in the US dollar amid mixed signals from the Fed and weak economic data also fail to inspire the bulls.
Further, the cable traders also fail to take advantage of improving Brexit situation, especially after the UK’s Environment Secretary George Eustice said on Thursday, "I think we're getting some positive indications and it's always our view that it's better if we can reach an agreement with the European Union on these things.”
Markets now look forward to the critical US PCE inflation data for fresh hints on the Fed’s next policy move, which will likely have a significant impact on the greenback, in turn, moving GBP/USD.
GBP/USD technical outlook
From a near-term technical perspective, the cable’s daily closing below the 100-Daily Moving Average (DMA) at 1.3951 has opened the doors for the next downtrend towards the upward sloping trendline support at 1.3793.
The 14-day Relative Strength Index (RSI) edges lower while below the midline, allowing room for more declines.
GBP/USD daily chart
On the flip side, any bounce will meet initial resistance at the abovementioned 100-DMA barrier, above which the mildly bullish 50-DMA at 1.4036 could be challenged.
However, the bulls need acceptance above 1.4000 is critical to unleashing additional upside.
GBP/USD additional levels to watch
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