GBP/USD: better bid at 1.2850 post Trump's tax plans announced

Currently, GBP/USD is trading at 1.2856, up 0.11% on the day, having posted a daily high at 1.2865 and low at 1.2805.

Full summary of Trump's tax plan

Trump's tax reform was a washout as far as the markets were concerned. The dollar gave back space on what seems to be a disappointment to the markets. The DXY has been trading in a range of 98.728 - 99.332 but is now moving in on the lower end of that range at 99.08. Cable subsequently rallied from 1.2818 to 1.2857. Stocks were lower on the announcements, but not by much. 

Focus now moves to the UK GDP and US GDP data for first and preliminary estimates Q1. The question is whether sterling's reversal of the Oct 2016 supply is corrective only of the June 2016 sell-off from 1.5000 and warrants caution on the bid. Analysts at Westpac offered their outlooks and a trade plan on further advances that should be faded with a target to the downside as per the following: A bearish trading plan to sell GBP/USD to 1.2630 - Westpac

GBP/USD levels

For the mean time within these tight ranges of consolidation GBP/USD’s near term, outlook is neutral: "Sterling remains short term bid while trading above Friday’s low at 1.2760. If slipped through, the February high at 1.2705 may be retested. We will remain medium term bullish while the currency pair stays above the 200-day ma at 1.2612, however," argued analysts at Commerzbank. "We allow for allow for further strength to the 55 week ma at 1.2986 to be seen once a rise above the current April high at 1.2930 has been witnessed. Until then further sideways trading remains on the cards for the next couple of days," added the analysts suggesting 1.2613 would trigger a slide back to 1.2515, the April 18 low and the 1.2347 February low.