GBP/USD analysis: Pound's rally to face a couple of macroeconomic challenges

Valeria Bednarik FXStreet

GBP/USD Current price: 1.4327

UK employment data foresaw encouraging, attention centered on wages' growth.
USD to remain under pressure amid political jitters denting its attractive.

The GBP/USD pair trades a handful of pips below 1.4345, the highest level achieved post-Brexit referendum, with dollar's broad weakness being the main reason behind the rally. Up for a seventh consecutive day, Pound's strength will suffer a couple of major challenges from the macroeconomic front these upcoming days, in the form of employment figures this Tuesday, and inflation ones on Wednesday. Average hourly earnings are expected to have advanced from previous readings, with wages, excluding bonuses, seen up 2.8% in the three months to February. Inflation, on the other hand, is seen decreasing, and both combined should mean decreasing pressure on the BOE to raise rates, which may have a contrarian effect on Pound, sending it lower when macroeconomic data improves. In the 4 hours chart, technical indicators have lost upward strength in overbought levels, with the RSI pretty much consolidating and the Momentum retreating. Nevertheless, and with the pair holding near its daily high, the risk is lean to the upside, with the next big resistance being 1.4345, January's monthly high.

Support levels: 1.4180 1.4150 1.4115

Resistance levels: 1.4295 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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