GBP/USD: Bulls eyeing a test of 1.3000 ahead of UK GDP

The overnight recovery in GBP/USD found extra legs in mid-Asia, now pushing the rate further towards 1.30 handle.

GBP/USD re-takes 1.3000

The spot staged a solid comeback in the US last session, after the US dollar slumped across the board, following the release of the FOMC minutes, which failed to offer anything new and hence, disappointed markets. The treasury yields also followed suit amid an unimpressive Fed minutes release.

In today’s trading so far, cable broke a brief consolidative range to the upside and heads towards 1.30 handle, in response to fresh selling seen in the US dollar across the board, as 2-year treasury yields accelerate the declines. The USD index drops -0.12% and inches closer to multi-month troughs reached at 96.70 earlier this week.

Moreover, positive sentiment around the Asian indices amid no updates delivered by the Fed on faster pace of rate hikes, also added to the renewed upside in the major. Meanwhile, higher oil prices ahead of the crucial OPEC Vienna meeting, keeps the sentiment buoyed around the risk-currency GBP.

Focus now shifts towards the second estimate of the Q1 UK GDP due on the cards ahead of the US dataflow and Fedspeaks, which will provide fresh impetus to the GBP bulls.

GBP/USD Levels to consider            

Valeria Bednarik, Chief Analyst at FXStreet noted: “Short term, however, the pair is expected to extend to its decline, given that in the 4 hours chart, the price is below a bearish 20 SMA, whilst technical indicators have extended their declines within negative territory, down to fresh weekly lows. Support levels: 1.2950 1.2910 1.2880 Resistance levels: 1.3025 1.3060 1.3100.”