GBP/USD: Steady below 1.3450, eyes on UK politics and US data

The rebound in the GBP/USD pair from below 1.34 handle faltered just shy of the 1.3450 mark, leaving the rates in a consolidative mode heading towards the early European trading.

GBP/USD: 1.3450 – a tough nut to crack?

The Cable is seen fluctuating between gains and losses over the last hour, after having failed yet another attempt to take-out the stiff resistances placed near the mid-point of 1.34 handle.

The recovery attempts in the major lack momentum, as the pound remains undermined amid resurgent Brexit jitters, after the UK Times reported that the UK PM Theresa May is expected to back down on Brexit date plan. Meanwhile, the latest remark from the German Chancellor Merkel on the Brexit deal also weighs down on the GBP.

However, the losses remain capped by broad weakness seen in the US dollar on the back of looming uncertainty over the US tax bill and dovish FOMC decision. 

On Thursday, the major witnessed good two-way price movements, initially having rallied to weekly tops of 1.3460 on solid UK retail sales numbers before breaching the 1.3400 support on the release of the BOE policy statement and upbeat US retail sales report, which lifted the US dollar across the board.

Later today, in absence of any macro news from the UK docket, markets will await the US data flow for the next trading impetus.

GBP/USD Technical Levels

According to Valeria Bednarik, Chief Analyst at FXStreet: “While lacking clear directional strength, the pair seems to be developing within a bearish channel, which is at its earliest stage. The roof of the figure comes at 1.3460, now the immediate resistance, followed by the 1.3500 figure. The daily low, on the other hand, is the immediate support, with a break below it favoring a downward extension toward the weekly lows in the 1.3300/10 region. Support levels: 1.3390 1.3350 1.3310. Resistance levels: 1.3460 1.3500 1.3540.”