Pound Sterling could face stiff resistance at 1.2500
|GBP/USD Forecast: Pound Sterling could face stiff resistance at 1.2500
GBP/USD gained traction in the early European session on Wednesday and climbed above 1.2450. The near-term technical outlook points to a buildup of recovery momentum but the pair could face stiff resistance at 1.2500.
The UK's Office for National Statistics (ONS) reported on Wednesday that inflation, as measured by the change in the Consumer Price Index (CPI), declined to 3.2% in March from 3.4% in February. This reading came in above the market expectation of 3.1%. Furthermore, the core CPI, which excludes volatile food and energy prices, rose 4.2% in the same period, compared to analysts' estimate of 4.1%. With the immediate reaction to these readings, Pound Sterling gathered strength against its rivals. Read more...
GBP/USD outlook: Sterling benefits from slightly higher than expected UK CPI
Cable bounces from new five-month low in early Wednesday, following higher than expected UK inflation in March, which eases pressure on BoE to start cutting interest rates as early as next month and inflates pound.
Overall technical picture on daily chart is firmly bearish but oversold conditions to signals for correction. Fresh gains cracked initial resistance at 1.2477 (Fibo 23.6% of 1.2709/1.2405 bear-leg, which guard more significant barriers at 1.2500/20 zone (psychological / former lows / Fibo 38.2%) and 1.2550 (10DMA / 50% retracement. Read more...
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