• A combination of factors helped limit any meaningful slide for the GBP/USD pair.
  • Declining COVID-19 cases in the UK and BoE's stance underpinned the sterling.
  • Uncertainty about the Fed’s tapering plan kept the USD bulls on the defensive.

The GBP/USD pair reversed an early European session dip to the 1.3840-35 region and quickly recovered around 25-30 pips in the last hour. The pair was last seen trading in the neutral territory, around the 1.3860-65 region, just below daily swing highs.

The pair struggled to capitalize on Friday's goodish rebound from sub-1.3800 levels, or two-and-half-week lows and the upside, so far, remain capped near the 1.3875-80 supply zone. Worries about the potential economic fallout from the Delta variant of the coronavirus continued weighing on investors' sentiment. This, in turn, extended some support to the safe-haven US dollar and exerted pressure on the GBP/USD pair.

That said, a combination of factors acted as a tailwind for the major and helped limit the downside. The British pound remained supported by the declining trend of new COVID-19 cases in Britain and the end of pandemic-related restrictions. Apart from this, the Bank of England's hints about modest tightening extended some additional support to the sterling. It is worth recalling that the BoE raised its inflation forecast at the end of the August policy meeting and endorsed market expectations for a rate hike in 2020.

On the other hand, investors now seemed to have scaled back their bets for an early policy tightening by the Fed amid signs of easing inflationary pressure in the US and a slump in consumer confidence. This was evident from the ongoing decline in the US Treasury bond yields, which kept the USD bulls on the defensive, which, in turn, assisted the GBP/USD pair to attract some dip-buying near the 1.3840-35 region.

There isn't any major market-moving economic data due for release on Monday, either from the UK or the US. Hence, the focus will remain on the US Retail Sales figures and Fed Chair Jerome Powell's speech on Tuesday. Apart from this, the FOMC meeting minutes on Wednesday will play a key role in influencing the USD price dynamics. This should assist investors to determine the next leg of a directional move for the GBP/USD pair.

Technical levels to watch

GBP/USD

Overview
Today last price 1.3864
Today Daily Change -0.0004
Today Daily Change % -0.03
Today daily open 1.3868
 
Trends
Daily SMA20 1.3835
Daily SMA50 1.3889
Daily SMA100 1.3927
Daily SMA200 1.3778
 
Levels
Previous Daily High 1.3875
Previous Daily Low 1.3791
Previous Weekly High 1.3894
Previous Weekly Low 1.3791
Previous Monthly High 1.3984
Previous Monthly Low 1.3572
Daily Fibonacci 38.2% 1.3843
Daily Fibonacci 61.8% 1.3823
Daily Pivot Point S1 1.3814
Daily Pivot Point S2 1.376
Daily Pivot Point S3 1.373
Daily Pivot Point R1 1.3898
Daily Pivot Point R2 1.3929
Daily Pivot Point R3 1.3983

 

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news Join Telegram

Recommended content


Recommended content

Editors’ Picks

AUD/USD Price Analysis: Bounces on Double Bottom, bullish reversal needs more filters

AUD/USD Price Analysis: Bounces on Double Bottom, bullish reversal needs more filters

The AUD/USD pair is going through a correction phase after facing barricades around 0.6920 in the New York session. The asset displayed some signs of reversal on Thursday after finding bids while testing two-week-old support at 0.6850.

AUD/USD News

USD/JPY inches towards 136.00 on higher-than-expected Unemployment data

USD/JPY inches towards 136.00 on higher-than-expected Unemployment data

The USD/JPY pair is aiming towards 136.00 as the Statistics Bureau of Japan has reported higher-than-expected Unemployment data. 

USD/JPY News

Gold Price Forecast: XAU/USD struggles to defend $1,800 as DXY rebounds ahead of US ISM PMI

Gold Price Forecast: XAU/USD struggles to defend $1,800 as DXY rebounds ahead of US ISM PMI

Gold Price (XAU/USD) holds onto the previous day’s bearish bias, despite taking rounds to the multi-day low surrounding $1,805 during Friday’s Asian session.

Gold News

One of the most iconic American rappers is bullish on Ethereum despite recent price slump

One of the most iconic American rappers is bullish on Ethereum despite recent price slump

Snoop Dogg and his son Champ Medici are one of the most prominent celebrities in the Ethereum NFT ecosystem. Dogg argues that the bear market is weeding out all the people who are not supposed to be in the space.

Read more

FXStreet Premium users exceed expectations

FXStreet Premium users exceed expectations

Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!

BECOME PREMIUM

Forex MAJORS

Cryptocurrencies

Signatures