- GBP/USD staged a goodish intraday bounce from the 1.3800 mark, or over two-week lows.
- Mixed US inflation figures prompted some USD profit-taking and provided a goodish lift.
- The lack of any strong follow-through buying warrants some caution for bullish traders.
The GBP/USD pair caught some aggressive bids during the early North American session and shot to fresh daily tops, around the 1.3870-75 region in reaction to mixed US inflation figures.
The pair found decent support and attracted some dip-buying near the 1.3800 round-figure mark, or over two-week lows touched earlier this Wednesday. The intraday recovery move got an additional boost following the release of the US consumer inflation figures, which prompted some profit-taking around the US dollar.
The headline CPI decelerate to 0.5% in July from the 0.9% increase recorded in the previous month. Adding to this, core CPI, which excludes food and energy prices, rose 0.3% MoM against 0.4% expected and June's 0.9%. This, along with Richmond Fed President Thomas Barkin's comments, weighed on the greenback.
Barkin noted that it may take a few months more for the US job market to recover enough for the Fed to reduce its crisis-era support for the economy. The combination of factors forced investors to trim their bets for an earlier Fed tapering. This was evident from a sharp pullback in the US Treasury bond yields.
In fact, the yield on the benchmark 10-year US government bond slumped back below the 1.35% threshold. Apart from this, a slightly positive risk tone further acted as a headwind for the safe-haven greenback. That said, the lack of any follow-through buying around the GBP/USD pair warrants caution for bullish traders.
Technical levels to watch
|Today last price||1.3871|
|Today Daily Change||0.0031|
|Today Daily Change %||0.22|
|Today daily open||1.384|
|Previous Daily High||1.3873|
|Previous Daily Low||1.3828|
|Previous Weekly High||1.3958|
|Previous Weekly Low||1.3861|
|Previous Monthly High||1.3984|
|Previous Monthly Low||1.3572|
|Daily Fibonacci 38.2%||1.3845|
|Daily Fibonacci 61.8%||1.3855|
|Daily Pivot Point S1||1.3821|
|Daily Pivot Point S2||1.3802|
|Daily Pivot Point S3||1.3776|
|Daily Pivot Point R1||1.3866|
|Daily Pivot Point R2||1.3892|
|Daily Pivot Point R3||1.3911|
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