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GBP/USD holds weaker near multi-day lows, around mid-1.4000s post-UK data

   •  Lower than expected UK current account deficit helps ease the bearish pressure.
   •  The final revision of UK GDP fails to provide any additional boost.
   •  A follow-through USD demand further collaborates towards capping gains.

The GBP/USD pair held on to its weaker tone for the third consecutive session, albeit managed to recover some lost ground post-UK economic data.

The British Pound gained some traction, lifting the pair back above mid-1.4000s, after a surprisingly lower than expected UK current account deficit, coming in at £18.44 billion as against £22.8 billion recorded in the previous quarter and £24.0 billion expected.

Meanwhile, the final revision of UK GDP, which showed Q4 2017 economic matched original estimates and stood at 0.4% q-o-q, did little to impress the bulls and provide any additional boost. 

This coupled with a follow-through US Dollar buying interest, backed by yesterday's bullish US Q4 GDP growth figures further collaborated toward capping, with the pair struggling to register any meaningful rebound. 

Later during the early NA session, the US economic data - core PCE price index (the Fed's preferred inflation gauge), personal income/spending data, usual initial weekly jobless claims, Chicago PMI and revised UoM consumer sentiment - would now be looked upon for some fresh impetus. 

Technical levels to watch

Immediate support is pegged near the 1.4025-20 region, below which the pair is likely to break below the key 1.40 psychological mark and head towards testing 1.3965 horizontal support. On the flip side, 1.4080-1.4100 region now seems to have emerged as an immediate hurdle, above which a bout of short-covering could lift the pair towards 1.4135-40 supply zone.
 

Author

Haresh Menghani

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

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