GBP/USD needs to move beyond 1.3310 to support prospects for further gains

GBP/USD regained positive traction on Friday and moved back closer to weekly tops as bulls seemed unaffected and largely shrugged off not so positive Brexit developments, FXStreet’s Haresh Menghani reports.  

Key quotes

“The British pound was underpinned by Friday's stronger-than-expected UK macro data. In fact, the headline retail sales recorded a growth of 1.2% MoM in October as against consensus estimates pointing to a flat reading. Meanwhile, the core retail sales (stripping the auto motor fuel sales) also came in better-than-expected and stood at 1.3% MoM during the reported month.”

“The EU negotiating team reportedly briefed envoys of the bloc's 27 member states that Brexit talks remain unresolved on three main issues – level playing field, fisheries and state-aid rules. In the absence of any major market-moving economic releases from the US, the incoming Brexit-related headlines will continue to play a key role in driving the near-term sentiment surrounding the major.”

“It will be prudent to wait for some follow-through buying beyond the 1.3300-1.3310 region before positioning for any further near-term appreciating move. A convincing breakthrough will be seen as a fresh trigger for bullish traders and set the stage for a move towards September daily closing highs, around the 1.3385 region, en-route the 1.3400 mark. On the flip side, immediate support is pegged near the 1.3250-45 region ahead of 1.3220 level (200-hour EMA) and the overnight swing lows, around the 1.3195 zone.”