The GBP/USD pair reversed a brief dip below 1.2350 region in the European session, and now heads back towards 1.24 handle, mainly driven by a positive tone in the European equities alongside broad based US dollar weakness.
More so, increased expectations over a better UK Feb CPI report and Brexit clarity also keeps the sentiment around cable underpinned. The consumer prices in the British economy are expected to tick 2.1% higher in February y/y, after having booked a 1.8% reading in January.
Meanwhile, the Article 50, the formal notification of Britain's intention to leave the EU, will be triggered on March 29, a Downing Street spokesperson confirmed on Monday morning.
The spot now eagerly awaits the UK CPI data and BOE Carney’s speech for next direction, ahead of the Fedspeak and US macro news.
GBP/USD Levels to consider
JFD Brokers Ltd. noted, “A drop below 1.2340 will open the way for the price to fall until the next support at 1.2250 which overlaps with the 50-SMA on the 4-hour chart. An alternative scenario is a further upward run if there is a penetration above the mentioned fresh high and the descending trend line that is holding since September 2016. A successful attempt to break the latter obstacle will expose the pair towards the 1.2580 resistance handle. Technically, on the short-term timeframe, the MACD oscillator is moving lower and slipped below its trigger line. The RSI indicator rebounded on the 70 level and is approaching the 50 level.”
- R3 1.2407
- R2 1.2401
- R1 1.2393
- PP 1.2387
- S1 1.2378
- S2 1.2373
- S3 1.2364