GBP/USD analysis: Tuesday's UK data to be critical

GBP/USD Current price: 1.3011

The GBP/USD pair closed at 1.3011, down for a second consecutive week, on poor demand for high-yielding assets amid dominating risk aversion, and a batch of disappointing UK data released on Thursday. Despite recovering on Friday due to dismal US inflation data, the Pound remains the weakest currency across the board after the USD, undermined by decreasing hopes of a BOE rate hike this year, and mounting uncertainty surrounding Brexit. This Tuesday will be key for the Pound, as the kingdom will release its July inflation figures at all levels, with CPI, PPI and the retail price index being out. Market's expectations point for another flat reading monthly basis, but an uptick in yearly inflation, thus this last needs to be quite significant to bring a rate hike back to the table. The pair is poised to extend its decline according to the daily chart, as the pair remains below its 20 SMA, while technical indicators hold within negative territory, although with limited downward strength. In the 4 hours chart, the pair settled above its 20 SMA, and around the 200 EMA, while technical indicators lack directional strength within neutral territory, indicating a limited upward potential. The pair topped for the week at 1.3030, the immediate resistance, but it would take an advance beyond 1.3060 to revert, at least short-term, the negative stance.

Support levels: 1.2985 1.2950 1.2910

Resistance levels: 1.3030 1.3060 1.3095

View Live Chart for the GBP/USD

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