GBP/USD nosing towards 1.34 as UK, US Retail Sales figures loom for hectic Thursday

Sterling testing into major resistance ahead of Retail Sales figures for both the US and the UK.
A well-timed break for the GBP/USD could see current resistance turn into support for a further push higher.

Joshua Gibson FXStreet

The GBP/USD is popping into the 1.3400 handle ahead of the UK Retail Sales and US Retail Sales doubleheader for Thursday.

UK Retail Sales, dropping at 08:30 GMT, are expected to come in at 2.4% (last 1.4%) for the y/y period into May. A hit for the indicator could provide the Sterling a much-needed boost to climb over current technical resistance, but the US session also brings US Retail Sales at 12:30 GMT. Retail Sales excluding autos for May are expected to tick up slightly from 0.3% to 0.5%, and a beat for the reading will likely send the Greenback higher, with the USD already getting supported through broader markets following the US Fed's rate hike on Wednesday, lifting the US rate 25 bps into the 2% target band of the US central bank.

GBP/USD Levels to watch

Sterling is pushing into current highs, and a break above the upper bound of the current descending channel will provide a welcome bolstering for future bullish momentum, though a downturn from this level will see aggressive selling to new lows.

Spot rate: 1.3398
Relative change: 0.18%
High: 1.3399
Low: 1.3370

Trend: Bearish

Support 1: 1.3308 (Wednesday low)
Support 2: 1.3294 (previous week low)
Support 3: 1.3202 (technical bottom; key major handle

Resistance 1: 1.3424 (current week high)
Resistance 2: 1.3471 (technical top; previous week high)
Resistance 3: 1.3490 (R3 1-Day pivot)

Author

Joshua Gibson

FXStreet

Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.

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