• GBP/USD has picked bids around 1.2200 after a minor correction on the soaring market mood.
  • Although the US inflation rate has been trimmed, the journey towards desired inflation is far from over.
  • A downbeat consensus for UK GDP could conclude the run-up of pound bulls.

The GBP/USD pair has sensed buying interest after correcting to the critical support of 1.2200. The asset aims to recapture its six-week high at 1.2293 as investors’ risk appetite has improved dramatically after a significant decline in the US inflation rate.

The release of the plain-vanilla US Consumer Price Index (CPI) at 8.5%, significantly lower than the forecasts of 8.7%, and the former figure of 9.1% has soared the market mood. The market participants were cautious as the Federal Reserve (Fed) was expected to remain harsh on interest rates after the release of the upbeat US Nonfarm Payrolls (NFP). Well, hawkish bets are still not down as the Fed has a long way to go to reach the desired inflation.

Also, comments from Neel Kashkari that “He is happier to see inflation surprised to the downside, the Fed is far far far away from declaring victory on inflation” confirms the continuation of a hawkish stance by the fed. In addition, Fed policymaker sees interest rates to 3.9% by the end of this year and at 4.4% by next year.

On the UK front, the pound bulls are awaiting the release of the Gross Domestic Product (GDP) due on Friday. As per the preliminary data, the UK economy has shrunk by 0.2% in this quarter vs an expansion of 0.8% reported earlier. On an annual basis, the economic data is likely to drop to 2.8% from the former figure of 8.7%.

GBP/USD

Overview
Today last price 1.2218
Today Daily Change 0.0139
Today Daily Change % 1.15
Today daily open 1.2079
 
Trends
Daily SMA20 1.205
Daily SMA50 1.2158
Daily SMA100 1.2455
Daily SMA200 1.2933
 
Levels
Previous Daily High 1.213
Previous Daily Low 1.2063
Previous Weekly High 1.2294
Previous Weekly Low 1.2003
Previous Monthly High 1.2246
Previous Monthly Low 1.176
Daily Fibonacci 38.2% 1.2089
Daily Fibonacci 61.8% 1.2105
Daily Pivot Point S1 1.2051
Daily Pivot Point S2 1.2024
Daily Pivot Point S3 1.1985
Daily Pivot Point R1 1.2118
Daily Pivot Point R2 1.2158
Daily Pivot Point R3 1.2185

 

 

 

 

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