GBP/USD subdued in familiar ranges around 1.3530s
|- The GBP/USD is flat in a subdued session as investors prepare for the US inflation report.
- Risk-sensitive currencies rise, while the greenback drops 0.13% against its peers.
- GBP/USD Technical Outlook: Neutral biased unless GBP bulls reclaim the 200-DMA at 1.3700.
The British pound remains subdued on Wednesday during the New York session, so far up 0.02% in the day. At the time of writing, the GBP/USD is trading at 1.3539. Financial markets mood is positive, as European equity indices finished in the green. Across the pond, US equity indices led by the heavy tech Nasdaq Composite record gains between 0.74% and 1.47%.
In the FX complex, risk-sensitive currencies led by the antipodeans and the CAD rise, followed by the EUR and safe-haven peers. The greenback extends its losses during the day, with the US Dollar Index (DXY), a gauge of the buck’s value against a basket of six currencies, losses 0.13%, down at 95.51.
In the bond market, US Treasury yields recede from weekly highs. In the case of the 10-year T-note yield, it retraces after reaching 1.97%, a level last seen in 2019. The 10-year T-note is at 1.922% at press time, down three basis points in the session as market participants get ready for Thursday’s release of US inflation figures.
A light US economic docket left GBP/USD traders adrift to Fed speaking and market sentiment. At press time, Cleveland’s Fed President Loretta Mester (voter 2022) said that she “expects inflation will moderate but would remain above 2% this year and next.” Worth noting that Mester supports a rate increase in March, followed by future rate hikes, which the economy will guide.
GBP/USD Price Forecast: Technical outlook
The GBP/USD is neutral biased, regardless of trading above the 50 and the 100-day moving average (DMAs) lying at 1.3448 and 1.3505, each. However, the presence of the 200-DMA at 1.3702 keeps GBP/USD bears in charge unless a challenge to the abovementioned level is launched.
Upwards, the GBP/USD resistance levels would be the 1.3600 figure, followed by February’s three high at .13622, and then the five-month-old downslope trendline that passes near the 200-DMA at 1.3700.
Contrarily, the GBP/USD first support would be the 100-DMA at 1.3505. Breach of the latter would expose the 50-DMA at 1.3448 and then the 1.3400 figure.
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