GBP/USD analysis: upside limited despite daily gains

Valeria Bednarik FXStreet

GBP/USD Current price: 1.3396

Pound gains limited, Brexit headlines add uncertainty.
UK manufacturing growth remains resilient, according to CBI.

The GBP/USD pair surged to a daily high of 1.3418 to settle mid-US afternoon around the 1.3400 level, helped by broad dollar's weakness and strong local data, as according to the latest CBI survey, manufacturing orders held at 30-year highs. The survey showed that total order books had a balance of plus 17%, with 28% of firms reporting above normal levels, beating expectations of 14%. In the meantime, the Brexit drama continues. EU's chief negotiator, Michel Barnier, who said that there's "no way" the UK will have a bespoke trade deal after leaving the EU, indicating that Britain must "face the consequences" of their decision. UK PM May, on the other hand, spoke at the House of Commons, saying that the moving to the next phase of Brexit negotiations was an important step on the way to a smooth and orderly Brexit. The pair continues developing inside a descendant channel, with the roof of the figure currently around 1.3435. In the 4 hours chart, the price settled a few pips above its 20 SMA, while technical indicators have recovered some ground, but the Momentum indicator remains within negative territory, with moderate upward strength, while the RSI indicator lost its strength upwards once surpassing its mid-line. The pair bottomed again around the 1.3300 level at the beginning of the day, making of it a line on the sand for bulls for the upcoming sessions.

Support levels: 1.3380 1.3345 1.3310

Resistance levels: 1.3400 1.3435 1.3480

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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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