The Sterling is trading slightly on the defensive at the end of the week, taking GBP/USD to the lower bound of the range near 1.2150.
GBP/USD retreats from 1.2300
The pair shed over a cent since yesterday’s tops around the 1.2300 handle, as sellers step in along with some pick up in the demand for the US dollar. Cable is thus closing its second consecutive week with losses, keeping the trade in the area of 3-month lows.
GBP’s outlook remains fragile and occasional bullish attempts seem to lack of any sustainability for the time being, all against heightened risks of a ‘hard Brexit’ scenario and despite some auspicious results in the UK economy as of late.
Absent releases in the UK calendar, the attention will shift to US Retail Sales and the advanced gauge of Consumer Sentiment measured by the Reuters/Michigan Index for the month of January.
GBP/USD levels to consider
As of writing the pair is losing 0.03% at 1.2155 and a breach of 1.2104 (low Jan.10) would open the door to 1.2081 (low Oct.28) and then 1.1450 (GBP ‘flash crash’ Oct.7). On the flip side, the next hurdle aligns at 1.2275 (20-day sma) followed by 1.2318 (high Jan.12) and finally 1.2414 (55-day sma).
- R3 1.2443
- R2 1.2381
- R1 1.2277
- PP 1.2215
- S1 1.2111
- S2 1.2049
- S3 1.1945