GBP/USD analysis: consolidating near recent highs ahead of UK GDP

Valeria Bednarik FXStreet

GBP/USD Current price: 1.4269

UK Q4 GDP to be released this Friday, seen at 0.4%.
GBP/USD could correct lower but remains intrinsically bullish.

The GBP/USD pair continued advancing, up to 1.4345 a fresh post-Brexit referendum high, on the back of dollar's weakness, exacerbated by ECB's monetary policy decision that resulted in a stronger EUR. The pair, however, retreated in the US afternoon to settle some 100 pips below the mentioned high, anyway holding to some modest intraday gains. Minor figures coming from the UK were mostly soft, as the CBI Distributive Sales Survey resulted as expected in January at 12%, down from previous 20%, reflecting the modest pace of growth in retail sales. Mortgage approvals in December were well below expected, resulting in 36.115K, well below the previous 39.007K or the expected 39.700K. This Friday the UK will release its Q4 GDP seen matching previous reading with a 0.4%. The 4 hours chart shows that the pair is currently in a consolidative stage near its highs, holding above a firmly bullish 20 SMA, over 150 pips below the current level. Technical indicators in the mentioned chart have lost their strength upward but hold within overbought territory, increasing chances of a correction, particularly if the pair break below 1.4220, the immediate support.

Support levels: 1.4220 1.4165 1.4120

Resistance levels: 1.4300 1.4345 1.4390

View Live Chart for the GBP/USD

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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