• Cunliffe's comments triggered the initial leg of recovery.
• Softer US data-led USD retracement provides an additional boost.
• US-UK trade deal hopes supportive of the goodish rebound.
The GBP/USD pair rallied around 75-pips from an intraday low level of 1.3103 and has now recovered a major part of its early decline to near two-week lows.
The pair managed to find decent support near monthly lows, set on July 2 and was supported by comments from BoE Cunliffe, saying that softer Q1 activity was driven by poor weather and the growth path remains broadly intact.
The up-move was further supported by a modest US Dollar retracement from tops following the release of import price data and weaker than expected UoM consumer sentiment index, which fell to 97.1 in July as against previous month's reading of 98.2.
Meanwhile, positive headlines coming out of the UK PM Theresa May and the US President Donald Trump's joint press conference, pointing to a possible US-UK trade deal provided a minor boost to the British Pound and further collaborated to the pair's goodish recovery.
It would now be interesting to see if the pair is able to build on the momentum or struggles to make it through the 1.3200 handle. Nevertheless, the pair remains on track to end the week in the red and possibly the lowest weekly close since Nov. 2017.
Technical levels to watch
The 1.3200 handle might continue to act as an immediate hurdle, above which the recovery move could further get extended back towards 1.3270-80 supply zone en-route the 1.3300 round figure mark.
On the flip side, the 1.3140 level now seems to protect the immediate downside, which if broken might turn the pair vulnerable to test sub-1.3100 level before eventually dropping to YTD low level of 1.3050.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD holds gains near 1.0650 amid risk reset
EUR/USD is holding onto its recovery mode near 1.0650 in European trading on Friday. A recovery in risk sentiment is helping the pair, as the safe-haven US Dollar pares gains. Earlier today, reports of an Israeli strike inside Iran spooked markets.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD is rebounding toward 1.2450 in early Europe on Friday, having tested 1.2400 after the UK Retail Sales volumes stagnated again in March, The pair recovers in tandem with risk sentiment, as traders take account of the likely Israel's missile strikes on Iran.
Gold price defends gains below $2,400 as geopolitical risks linger
Gold price is trading below $2,400 in European trading on Friday, holding its retreat from a fresh five-day high of $2,418. Despite the pullback, Gold price remains on track to book the fifth weekly gain in a row, supported by lingering Middle East geopolitical risks.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Geopolitics once again take centre stage, as UK Retail Sales wither
Nearly a week to the day when Iran sent drones and missiles into Israel, Israel has retaliated and sent a missile into Iran. The initial reports caused a large uptick in the oil price.