GBP/USD reverses early dip, flat-lined around mid-1.3000s

  • GBP/USD reversed an early dip to weekly lows following the release of UK GDP report.
  • A modest intraday USD pullback from tops provided an additional boost to the major.
  • Market participants now look forward to the US CPI report for some trading impetus.

The GBP/USD pair edged higher during the early European session and refreshed daily tops, around the 1.3067 region in the last hour, albeit lacked any strong follow-through.

Following the previous day's intraday pullback of around 90 pips and a subsequent dip to weekly lows, the pair managed to attract some dip-buying and was being supported by a combination of factors. The British pound found some support following the release of better-than-expected UK GDP report, which showed that the economy expanded by 8.7% in June as against consensus estimates pointing to a growth of 8%.

Meanwhile, the preliminary figures showed that the UK economy contracted by 20.4% in the second quarter of 2020 as compared to a 2.2% contraction recorded in the previous quarter. Two consecutive periods of contraction means that the British economy is now in a technical recession. The report, however, did little to impress bearish traders or prompt any meaningful selling around the British pound.

On the other hand, the US dollar struggled to preserve its intraday gains amid the uncertainty over the next round of the US fiscal stimulus measures. This, in turn, was seen as one of the key factors that extended some support to the GBP/USD pair. Meanwhile, hopes of a US economic recovery and some follow-through pickup in the US Treasury bond yields extended some support to the USD and capped the upside for the major.

From a technical perspective, the pair has been confined in a range over the past week or so. This further makes it prudent to wait for a sustained move in either direction and positioning for the pair's near-term trajectory. A convincing break through the key 1.3000 psychological mark will be seen as a fresh trigger for bearish traders and set the stage for an extension of the GBP/USD pair's retracement slide from multi-month tops.

Moving ahead, market participants now look forward to the release of the latest US consumer inflation figures for July. The data might influence the USD price dynamics and produce some short-term trading opportunities later during the early North American session.

Technical levels to watch


Today last price 1.3056
Today Daily Change 0.0008
Today Daily Change % 0.06
Today daily open 1.3048
Daily SMA20 1.2897
Daily SMA50 1.2678
Daily SMA100 1.2517
Daily SMA200 1.2711
Previous Daily High 1.3132
Previous Daily Low 1.3042
Previous Weekly High 1.3186
Previous Weekly Low 1.2982
Previous Monthly High 1.317
Previous Monthly Low 1.236
Daily Fibonacci 38.2% 1.3076
Daily Fibonacci 61.8% 1.3098
Daily Pivot Point S1 1.3016
Daily Pivot Point S2 1.2984
Daily Pivot Point S3 1.2925
Daily Pivot Point R1 1.3106
Daily Pivot Point R2 1.3164
Daily Pivot Point R3 1.3197



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.

Feed news

Latest Forex News

Latest Forex News

Editors’ Picks

EUR/USD trades at fresh September lows

Risk-aversion is the main theme this Monday, amid resurgent coronavirus cases in the Old Continent and the announcement of  new lockdowns. ECB’s Lagarde said the economic recovery in the EU is “very uncertain, uneven and incomplete.”


GBP/USD extends slump sub-1.2800

The Pound plunged on a dismal market mood, as PM Johnson acknowledged the kingdom is undergoing a second coronavirus wave. GBP/USD trades at one-week lows around 1.2800.


XAU/USD bullish bias starting to fade

Gold prices are testing the bull's commitments at the support structure around $1,906 in what could be a final test before the next leg higher of the bullish trend.

Gold News

Bitcoin needs to defend critical support level at $10,600

Bitcoin was trading inside an ascending triangle pattern between September 3 and September 15, which is created when the price establishes higher lows and a horizontal trendline around the swing highs. 

Read more

WTI plummets to $39, down more than 4%

Crude oil prices closed the previous week sharply higher but erased a large portion of those gains on Monday. As of writing, the barrel of West Texas Intermediate was down 4.2%, the biggest daily percentage decline in nearly two weeks, at $39.15.

Oil News