GBP/USD looks offered and challenges 1.2600 amidst strong US Dollar

GBP/USD loses further ground and breaks below 1.2600.
The better tone in the Greenback weighs on the risk complex.
The UK BRC Retail Sales Monitor rose 5.2% YoY in April.

Pablo Piovano FXStreet

The British pound, along with the rest of the risk-associated universe, comes under pressure and motivates GBP/USD to dispute the 1.2600 region on Tuesday.

GBP/USD down on stronger Dollar, looks at BoE

GBP/USD retreats for the second consecutive session and pierces the key support at 1.2600 the figure amidst the generalized bearish note Cable in the first half of the week.

In fact, the Greenback extends the promising start of the week and keeps the risk complex under pressure against the backdrop of easing concerns over the US banking sector, particularly following the Fed’s Senior Loan Officer Survey late on Monday.

Moving forward, the Quid is expected to remain under the microscope in light of the upcoming BoE gathering on May 11, where consensus largely anticipates another 25 bps rate hike.

In the UK calendar, April releases saw the BRC Retail Sales Monitor increase 5.2% from a year earlier, while the House Price Index measured by Halifax contracted 0.3% MoM and rose 0.1% over the last twelve months. Finally, BBA Mortgage Rate ticked higher to 7.41% (from 7.22%).

GBP/USD levels to consider

As of writing, the pair is losing 0.09% at 1.2605 and faces the next support at 1.2435 (monthly low May 2) followed by 1.2344 (weekly low Aprl 10) and finally 1.2295 (55-day SMA). On the other hand, the surpass of 1.2668 (2023 high May 8) would open the door to 1.2865 (200-week SMA) nad then 1.3000 (psychological level).

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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