GBP/USD Forecast: near-term trading range holds ahead of UK employment figures

The GBP/USD pair dropped to an intraday low level of 1.3072 on Tuesday following a slight miss in British inflation figures, with headline CPI unchanged at 3.0% as against consensus estimates of a rise to 3.1%. However, broad-based US Dollar sell-off, despite hotter-than-expected US PPI print, helped the pair to bounce off lows and settle above mid-1.3100s. 

The pair is once again retreating from the 1.3180-90 supply zone as investors refrained from placing aggressive bets amid the latest political developments in the UK and deadlock over the Brexit divorce bill. Today's economic docket features the release of UK employment figures, with market focus glued to the critical wage growth data. Later during the North American session, the latest consumer inflation figures and monthly retail sales data from the US might also influence the pair's momentum on Wednesday.

From a technical perspective, the pair is showing resilience below 100-day SMA and simultaneously is seen struggling to move back above the 1.3200 handle. Hence, it would be prudent to wait for a decisive break through the mentioned range before positioning for the next leg of directional move.

Below the 100-day SMA, currently near the 1.3115 region, 1.3050 levels should continue to offer strong support, which if broken should accelerate the slide towards a short-term descending trend-line support near the key 1.30 psychological mark. The bearish slide could further get extended towards the 1.2950 support, marked by the 61.8% Fibonacci expansion level of the 1.3657-1.3027 downslide and its subsequent rebound.

Alternatively, a clear break through the 1.3200 handle might trigger a short-covering bounce towards the 1.3300 handle, which if conquered might negate any near-term bearish bias and pave way for extension of the pair's upward trajectory in the near-term.


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