GBP/USD outlook: Bulls face strong headwinds but remain in play, US inflation data in focus

Slobodan Drvenica Windsor Brokers

GBP/USD

Cable edges lower in early Friday’s trading as bulls continue to face headwinds and repeatedly failing to sustain gains above 1.24 mark, keeping the price action in sideways mode for one week.

Strong barrier at 1.2446 (base of falling weekly cloud/Dec 14 top) continues limit recovery leg from 1.1841 (Jan 6 low), though near-term action is expected to keep bullish bias while holding above 1.2263 (Jan 24 higher low).

Daily techs are weakening on fading bullish momentum and south-heading RSI, but MA’s remain in bullish setup, with 10DMA offering initial support at 1.2349 ahead of 1.2263 pivot. Thick daily cloud also underpins (cloud top lays at 1.2166).

Limited advance was seen on Thursday, following stronger than expected US Q4 GDP, while traders turn focus to US PCE data, the Fed’s preferred inflation measure, to get more clues about the central bank’s next steps.

Res: 1.2446; 1.2500; 1.2527; 1.2589.
Sup: 1.2349; 1.2304; 1.2263; 1.2216.

Interested in GBP/USD technicals? Check out the key levels

1. R3 1.2534
2. R2 1.2482
3. R1 1.2448
PP 1.2396
1. S1 1.2362
2. S2 1.2311
3. S3 1.2277

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

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