GBPUSD Outlook: Sterling firm after weaker than expected US CPI; ignores negative news regarding Brexit

Slobodan Drvenica Windsor Brokers

GBPUSD

Cable jumped to new three-week high at 1.3246 after US CPI miss on Thursday added to bullish sentiment over Brexit. The pair broke above Fibo barrier at 1.3209 (76.4% of 1.3297/1.2922), opening way towards 1.3300 zone (1.3297 – 20Sep high / round-figure barrier) where strong offers could be expected. Fresh bullish momentum on daily chart underpins, but strongly overbought slow stochastic requires caution. In addition, PM May comes under pressure from parliamentary partner DPU who threatened to withdraw its support in Brexit talks, which would make impossible passing the legislation in the parliament. In addition, former PM Blair said that there is a 50/50 chance of another Brexit referendum if May’s Brexit plan does not pass vote in the parliament. Despite fresh twist in Brexit story, the pound remains firm and driven by weaker dollar and optimistic expectations on final Brexit deal.

Res: 1.3246; 1.3276; 1.3297; 1.3362
Sup: 1.3209; 1.3170; 1.3154; 1.3133

Interested in GBPUSD technicals? Check out the key levels

1. R3 1.3309
2. R2 1.3263
3. R1 1.3227
PP 1.3181
1. S1 1.3146
2. S2 1.31
3. S3 1.3064

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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