GBP/USD analysis: technically bullish, but beware of Brexit woes

Valeria Bednarik FXStreet

GBP/USD Current price: 1.2546

The GBP/USD pair closed Friday at 1.2550, marginally higher weekly basis and at its highest settlement since early February. The pair fell to 1..2375 last Wednesday, when the UK formally triggered the Brexit through a letter to the EU, further undermined by news that the Scottish Parliament backed FM minister Sturgeon desire to trigger a second independence referendum. The Pound, however, managed to recover the ground lost, despite UK's final Q4 GDP suffered a modest downward revision, down to 1.9% from previous 2.0%, whilst Total Business investment fell by 0.9% in the last three months of 2016. The current account balance however, improved in the same period, printing a deficit of £12 billion against a previously revised one of £25 billion. Technically, the daily chart for the pair shows that the upside is favored as the price settled above the 23.6% retracement of its January's rally and well above a bullish 20 SMA, whilst the RSI indicator resumed its advance within positive territory, now heading north around 60. In the 4 hours chart, technical indicators maintain upward slopes well into positive territory, whilst the 20 SMA has turned flat well below the current level, in line with the longer term perspective.

Support levels: 1.2520 1.2480 1.2445

Resistance levels: 1.2579 1.2620 1.2660

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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