GBP/USD consolidates 3-day rally near 1.2870, 1.2900 back on sight?

Dhwani Mehta FXStreet

After having posted fresh weekly tops at 1.2876, the bulls appear to have taken a breather, keeping GBP/USD side-lined near the last.

Cable trims gains as broad based US dollar selling abates heading into early European trading, as markets look past the US tax reforms plan news and look forward to a spate of US macro data due later today.

Moreover, a tepid-bounce in the treasury yields across the curve also helps limit the upside in the GBP/USD pair.

Meanwhile, investors now await a fresh trigger for a range break-out in the spot, which is stuck between within 120-pips ever since the flash rally to 1.2910 levels.

Also, cross-driven moves could affect the major ahead of the ECB policy decision, which could have significant impact on EUR/GBP.

GBP/USD Levels to consider

A break above 1.2900/12 (round figure/ flash rally high) could lift the pair above 1.2950 (psychological levels), beyond which a test of 1.2948 (flash crash high) is imminent. Conversely, a break below 1.2835 (5-DMA), leading to a subsequent break below 1.2798 (10-DMA) is likely to drag the pair towards testing its next support near 1.2758 (Apr 21 low).

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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