GBP/USD recedes from tops, back below 1.2500

GBP/USD clinches 2-week tops above 1.2500, drops afterwards.
Dollar-weakness, risk-on trade lifted Cable to new peaks.
UK’s CBI Distributive Trades Survey dropped to -55 in April.

Pablo Piovano FXStreet

GBP/USD has come under some selling pressure following a move to fresh 2-week highs beyond 1.2500 the figure earlier in the session.

GBP/USD stronger on USD-selling, risk appetite

Despite the correction from weekly highs recorded during early trade, Cable manages well to keep the positive note on Tuesday, always on the back of the persistent selling bias surrounding the greenback and the generalized upbeat mood in the risk complex.

Indeed, and other than dollar-selling, the sterling has gathered extra steam as market participants are positively assessing the probability of a gradual re-opening of the UK and other major economies overseas.

In the domestic docket, the CBI Distributive Trends Survey plummeted to -55 for the current month vs. a forecasted -40 drop. Later in the week the attention will be on the publication of the April’s manufacturing PMI where markets should get a clearer idea of the initial impact of the coronavirus on the UK economy.

Across the Atlantic, the Conference Board’s Consumer Confidence came in at 86.9 for the current month. Earlier, advanced trade balance figures showed an expected $64.22 billion deficit in March while house prices tracked by the S&P/Case-Shiller index rose 3.5% on a year to February.

GBP/USD levels to consider

As of writing, the pair is gaining 0.18% at 1.2449 and a breakout of 1.2518 (weekly high Apr.28) would open the door to 1.2643 (200-day SMA) and then 1.2746 (100-day SMA). On the other hand, the next support emerges at 1.2247 (weekly low Apr.21) followed by 1.2163 (monthly low Apr.6) and finally 1.2093 (38.2% Fibo of the March drop).

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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