• GBP/USD struggled to build on its intraday positive move and faced rejection near the 1.4000 mark.
  • Renewed USD buying interest was seen as a key factor that prompted some selling at higher levels.
  • Optimism over a swift UK economic recovery underpinned the GBP and helped limit the downside.

The GBP/USD pair refreshed daily lows in the last hour, albeit managed to defend the 1.3900 mark and quickly recovered few pips thereafter. The pair was last seen trading just below mid-1.3900s, up around 0.10% for the day.

The pair failed to capitalize on its intraday uptick, instead faced rejection near the key 1.4000 psychological mark amid a goodish pickup in the US dollar demand. The reflation trade has been fueling expectations that the Fed will have to tighten monetary policy earlier than previously expected. This was seen as a key factor that continued lending some support to the USD and kept a lid on any meaningful upside for the GBP/USD pair.

The negative factor, to some extent, was offset by the optimism over the UK government's plan to ease current lockdown measures and hopes for a swift UK economic recovery. Apart from this, comments by the Bank of England (BoE) Deputy Governor Dave Ramsden, saying that contingency planning is very different from thinking negative rates will be used extended some support to the British pound and helped limit the downside for the GBP/USD pair.

That said, the pair's inability to attract any follow-through buying indicates that a lot of positive is already priced in for the sterling. This, in turn, suggests that the near-term bias might have shifted in favour of bearish traders. Sustained weakness below the 1.3900 round-figure mark will reaffirm the negative outlook and turn the GBP/USD pair vulnerable to extend its recent corrective slide from the vicinity of mid-1.4200s, or three-year tops.

Market participants now look forward to the US economic docket, highlighting the release of the US ISM Manufacturing PMI. This, along with the US bond yields, will influence the USD price dynamics and produce some short-term trading opportunities around the GBP/USD pair.

Technical levels to watch


Today last price 1.3951
Today Daily Change 0.0022
Today Daily Change % 0.16
Today daily open 1.3929
Daily SMA20 1.3867
Daily SMA50 1.371
Daily SMA100 1.3456
Daily SMA200 1.3129
Previous Daily High 1.403
Previous Daily Low 1.389
Previous Weekly High 1.4243
Previous Weekly Low 1.389
Previous Monthly High 1.4243
Previous Monthly Low 1.3566
Daily Fibonacci 38.2% 1.3944
Daily Fibonacci 61.8% 1.3977
Daily Pivot Point S1 1.3869
Daily Pivot Point S2 1.381
Daily Pivot Point S3 1.373
Daily Pivot Point R1 1.4009
Daily Pivot Point R2 1.4089
Daily Pivot Point R3 1.4149



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

EUR/USD jumps towards 1.0600 as USD wilts amid risk rebound

EUR/USD jumps towards 1.0600 as USD wilts amid risk rebound

EUR/USD is trading back above 1.0550,resuming its recovery towards 1.0600 in early Europe this Wednesday. The US dollar meets fresh supply as the risk rebound extends, despite looming recession fears. ECB Forum, US Durable Goods and Fedspeak eyed. 


GBP/USD consolidates gains below 1.2300 amid weaker USD, Brexit woes

GBP/USD consolidates gains below 1.2300 amid weaker USD, Brexit woes

GBP/USD is holding onto the latest upside below 1.2300 in early European trading, The risk-on mood dents the US dollar's safe-haven appeal while the UK presses on with changes to the Brexit deal despite EU opposition. US data awaited. 


Gold bulls aim for $1,850 on Russia news, softer USD

Gold bulls aim for $1,850 on Russia news, softer USD

Gold Price extends Friday’s recovery to $1,836 ahead of Monday’s European session. The precious metal’s upside moves could be linked to the softer US dollar, as well as chatters surrounding a ban on gold imports from Russia.

Gold News

SEC vs. Ripple: Brad Garlinghouse announces expansion out of the US if outcome is unfavorable

SEC vs. Ripple: Brad Garlinghouse announces expansion out of the US if outcome is unfavorable

XRP will expand out of the US if the payment giant faces a loss in the lawsuit. The community awaits the court's ruling on his speech and related documents. Analysts remain bullish on Ripple price

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!