The GBP/USD pair pared some of its early losses to the vicinity of 1.2400 handle, albeit maintained its bearish bias for the third consecutive session, following the release of prelim US GDP growth figures.
Currently trading around 1.2430-35 region, the pair gained some traction during early NA session after the revised US economic growth for the fourth-quarter of 2016 matched initial estimates and came-in at an annualized rate of 1.9%. The reading was lower-than 2.1% growth expected and added on to slightly bearish sentiment surrounding the greenback. In fact, the key US Dollar Index has now dipped below the 101.00 handle and provided some temporary respite for the major.
The pair, however, remained within familiar trading range and has held above the 1.2385-80 strong horizontal support as market participants wait to hear the US President Donald Trump’s first address to a joint session of Congress, later during NY session, for some clarity over his proposed pro-growth economic policies.
In the meantime, the release of Chicago PMI and CB's Consumer Confidence Index might also provide some opportunities for short-term traders.
Technical outlook
Valeria Bednarik, Chief Analyst at FXStreet notes, "From a technical point of view, the GBP/USD pair has made little progress, now trading below its 20 SMA in the 4 hours chart, and with technical indicators lacking directional strength right below their mid-lines. Also, the price is stuck around the 38.2% retracement of its latest bullish run. US data can give the greenback some direction, but it's possible the market will wait for Trump to take some stronger positions. Anyway, the immediate resistance is 1.2380, where the pair bottomed multiple times this month, followed by 1.2345, February low and the 50% retracement of the same rally. Below this last, the bearish momentum will likely accelerate"
"To the upside, 1.2480 is the immediate resistance, followed by the 1.2520/40 region, where selling interest is expected to contain rallies."
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