GBP/USD analysis: No relief for Pound

Valeria Bednarik FXStreet

GBP/USD Current price: 1.2698

Sterling retains the dubious honor of being the weakest currency among majors.
UK Retail Sales to be out Thursday expected to bounce sharply after June's decline.

The Pound plunged to a fresh yearly low of 1.2661 against the greenback, with the later bounce in the GBP/USD pair capped by selling interest aligned around the 1.2700 threshold. The UK released July inflation figures, with yearly CPI up o 2.5%, as expected, after holding steady at 2.4% in the previous three months. Prices at factory levels increased by 3.1%, while the Retail Prices Index fell to 3.2% from the previous 3.4%. The overall consumer price inflation at 2.5% is barely in line with wages' growth, as average earnings including bonuses, rose by an annual 2.4% in the three months to June. The number is barely enough to keep the economy running, but fell short of being a game changer for the BOE. The UK will release July Retail Sales this Wednesday, expected to post a 0.2% monthly advance after falling by 0.5% in June. Meanwhile, fears of a no-deal Brexit keep undermining Pound's demand. Technically, the pair is down for a second consecutive day, and still bearish according to technical readings in the 4 hours chart, as the pair keeps developing below a firmly bearish 20 SMA, while technical indicators continue to move back and forth within negative levels, lacking directional strength at the time being.

Support levels: 1.2665 1.2620 1.2575

Resistance levels: 1.2735 1.2760 1.2795

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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