Forex: GBP/USD jumps after UK data before settling at 1.5893/98

FXstreet.com (Barcelona) - The GBP/USD jumped nearly 24 pips after the publication of a pantheon of economic indicators out of the United Kingdom, establishing a fresh session high of 1.5905 during European trading Tuesday. However, in recent minutes, the pair has eased off its high, retracting slightly below the 1.5900 level and settling at 1.5893/98.

According to Slobodan Drvenica, an analyst at Windsor Brokers Ltd., “A break below strong support at 1.5900 zone (Fibonacci support/ daily Ichimoku cloud base, opens way for fresh weakness, with fresh slide approaching the 200-day MA at 1.5848. Consolidative or corrective corrective action above here is likely as 4h studies are extended, while hourly MACD showing a bullish divergence.”

In the United Kingdom, the Core Consumer Price Index (YoY) rose +2.6% in October, relative to a previous figure of +2.1% in September. Meanwhile the Consumer Price Index (MoM and YoY) gained only +0.1% in October (against a consensus of +0.2%) and +2.7% (beating estimates of only +2.3%) respectively.

Despite the move off its session highs, the GBP/USD is still recording a +0.09% advance on the day. According to the Drvenica, resistance is centered in the nearby zone of 1.5914, followed by additional corrective means at 1.5928 onto 1.5950. Otherwise, a move to the downside will activate supports at 1.5857, down to 1.5848 and finally 1.5800.

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