GBP/USD breaks below 1.2400 handle after US macro releases

Haresh Menghani FXStreet

The GBP/USD pair ran through fresh offers following the release of US economic data and extended the slide further below 1.2400 handle.

Currently trading at fresh multi-day lows, around 1.2385 region, spot accelerated the downslide on upbeat US economic data that showed yearly inflation surged in January at the highest rate in four years. In fact, the headline inflation, as measured by CPI, climbed 2.5% over the 12-months ending in January and pushed the US Treasury bond yields higher across the board on growing expectations of additional Fed rate-hike action in the near-term.

In addition to this, better-than-expected monthly retail sales data and strong reading for the Empire State Manufacturing Index further collaborated to the prevalent bullish sentiment around the key US Dollar Index and attracted fresh selling pressure around the major, which was already weighed down by weaker average earnings growth data from the UK.

Next on tap would be industrial production and capacity utilization data, followed by the Fed Chair Janet Yellen's second day of testimony before the House Financial Services Committee.

Technical levels to watch

The ongoing bullish momentum seems strong enough to continue dragging the pair towards 1.2350-45 support area below which the pair would turn vulnerable to break below 1.2300 handle and head towards testing its next support near 1.2260-55 horizontal zone.

On the flip side, recovery back above 1.2400 handle might now confront immediate resistance at 50-day SMA near 1.2420 region above which a fresh bout of short-covering is likely to lift the pair back towards 1.2500 psychological mark.

Sell 18%

Buy 82%

Avg Sell Price 1.2429

Avg Buy Price 1.2410

Liquidity Distribution

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

EUR/USD hits two-day highs near 1.1820

EUR/USD picks up pace and reaches two-day tops around 1.1820 at the end of the week. The pair’s move higher comes on the back of renewed weakness in the US Dollar amid growing talk that the Fed could deliver an interest rate cut as early as March. On the docket, the flash US Consumer Sentiment improves to 57.3 in February.

GBP/USD reclaims 1.3600 and above

GBP/USD reverses two straight days of losses, surpassing the key 1.3600 yardstick on Friday. Cable’s rebound comes as the Greenback slips away from two-week highs in response to some profit-taking mood and speculation of Fed rate cuts. In addition, hawkish comments from the BoE’s Pill are also collaborating with the quid’s improvement.

Gold climbs further, focus is back to 45,000

Gold regains upside traction and surpasses the $4,900 mark per troy ounce at the end of the week, shifting its attention to the critical $5,000 region. The move reflects a shift in risk sentiment, driving flows back towards traditional safe haven assets and supporting the yellow metal.

Crypto Today: Bitcoin, Ethereum, XRP rebound amid risk-off, $2.6 billion liquidation wave

Bitcoin edges up above $65,000 at the time of writing on Friday, as dust from the recent macro-triggered sell-off settles. The leading altcoin, Ethereum, hovers above $1,900, but resistance at $2,000 caps the upside. Meanwhile, Ripple has recorded the largest intraday jump among the three assets, up over 10% to $1.35.

Three scenarios for Japanese Yen ahead of snap election

The latest polls point to a dominant win for the ruling bloc at the upcoming Japanese snap election. The larger Sanae Takaichi’s mandate, the more investors fear faster implementation of tax cuts and spending plans.

XRP rally extends as modest ETF inflows support recovery

Ripple is accelerating its recovery, trading above $1.36 at the time of writing on Friday, as investors adjust their positions following a turbulent week in the broader crypto market. The remittance token is up over 21% from its intraday low of $1.12.