GBP/USD recovers modest intraday losses post-US PCE Price Index, flat-lines below 1.2300


  • GBP/USD attracts some dip-buying and remains closer to over a two-month high set on Friday.
  • The USD pares intraday gains in reaction to softer inflation data and lends support to the pair.
  • The fundamental backdrop favours bulls and supports prospects for a further appreciating move.

The GBP/USD pair reverses a dip to the 1.2355-1.2350 region and trades in the neutral territory during the early North American session on Friday. The pair, however, remains below over a two-month high touched this Friday and is currently placed around the 1.2380-1.2385 zone, nearly unchanged for the day.

The US Dollar (USD) trims a part of its intraday gains following the release of the Personal Consumption Expenditures (PCE) Price Index and turns out to be a key factor that assists the GBP/USD pair to attract fresh buyers at lower levels. In fact, the US Bureau of Economic Analysis reported that the headline PCE Price Index decelerated to a 5% YoY rate in February - the slowest pace of rise since September 2021. Adding to this, the Fed's favourite inflation indicator - Core PCE Deflator - edged down to 4.7% during the reported month against consensus estimates pointing to a steady reading of 4.7%.

The data fuels speculations that the Federal Reserve might soon pause the rate-hiking cycle in the wake of the turmoil in the banking sector, which is evident from a fresh leg down in the US Treasury bond yields. This, along with the prevalent risk-on mood, acts as a headwind for the safe-haven Greenback and lends support to the GBP/USD pair. The British Pound is further underpinned by the prospects for additional interest rate hikes by the Bank of England (BoE). The bets were reaffirmed by the UK GDP print, which showed that the economy expanded by 0.1% during the fourth quarter.

The fundamental backdrop favours bullish traders and suggests that the path of least resistance for the GBP/USD pair is to the upside. Hence, any meaningful pullback might still be seen as a buying opportunity and is more likely to remain limited, at least for the time being. Nevertheless, spot prices remain on track to register strong weekly gains and end in the green for the sixth successive week.

Technical levels to watch

GBP/USD

Overview
Today last price 1.2376
Today Daily Change -0.0012
Today Daily Change % -0.10
Today daily open 1.2388
 
Trends
Daily SMA20 1.2149
Daily SMA50 1.215
Daily SMA100 1.2125
Daily SMA200 1.1895
 
Levels
Previous Daily High 1.2393
Previous Daily Low 1.2294
Previous Weekly High 1.2344
Previous Weekly Low 1.2167
Previous Monthly High 1.2402
Previous Monthly Low 1.1915
Daily Fibonacci 38.2% 1.2355
Daily Fibonacci 61.8% 1.2332
Daily Pivot Point S1 1.2324
Daily Pivot Point S2 1.2259
Daily Pivot Point S3 1.2225
Daily Pivot Point R1 1.2423
Daily Pivot Point R2 1.2458
Daily Pivot Point R3 1.2522

 

 

Share: Feed news

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


Recommended content

Editors’ Picks

EUR/USD hovers around 1.0850 as US Dollar stabilizes

EUR/USD hovers around 1.0850 as US Dollar stabilizes

EUR/USD is trading sideways at around 1.0850 in European trading on Monday. A lack of fresh fundamental catalysts and holiday-thinned market conditions leave the pair oscillating in a tight range. 

EUR/USD News

GBP/USD keeps range near 1.2750 amid holiday-thinned trading

GBP/USD keeps range near 1.2750 amid holiday-thinned trading

GBP/USD is trading modestly flat, keeping its range near 1.2750 in the European morning on Monday. The pair is subject to thin liquidity and minimal volatility, courtesy of US and UK market holidays. 

GBP/USD News

Gold: Acceptance above $2,350 is critical to sustain the upturn

Gold: Acceptance above $2,350 is critical to sustain the upturn

Gold price is building on the recovery from two-week lows early Monday, as US holiday-induced thin market conditions support buyers. Besides, renewed optimism around China’s economic growth prospects and a fresh escalation in the war between Israel and Hamas provide extra legs to the ongoing rebound in Gold price.

Gold News

BTC/USD appears poised for further outperformance

BTC/USD appears poised for further outperformance

Last week was another positive for BTC/USD, which was up +1.9% as of London’s close on Friday despite finishing considerably off its best levels. Price movement on the weekly timeframe has been working between the limits of a potential bullish flag pattern.

Read more

Final full week of May welcomes updated inflation data

Final full week of May welcomes updated inflation data

Monday will likely be a snoozer, with US and UK banks closing in observance of Bank Holidays. The majority of focus this week will fall on Friday’s US PCE inflation for April, alongside personal income and spending. 

Read more

Forex MAJORS

Cryptocurrencies

Signatures