GBP/USD struggles around 1.3260 at the beginning of an eventful day

GBP/USD trades near 1.3260 during early Friday.
The pair refrained from extending previous gains on Thursday as upbeat US data and lack of developments from the UK pushed investors towards profit-booking.
1.3230 and 1.3200 seem immediate supports while 1.3280 and 1.3300 can please buyers during pullback.

Anil Panchal FXStreet

GBP/USD is taking the bids around 1.3260 during early Asian trading on Friday. The pair slipped off a seven-month high of Wednesday and posted declines on Thursday as investors reassessed chances of a smooth Brexit during silence on the economic calendar and less drama in the UK parliament. Friday is likely to deviate from the recent pattern of no major British data as the February month Markit manufacturing PMI from the UK is up for release whereas the US Fed Chair Jerome Powell’s speech in next few hours will also gain market attention.

The GBP/USD pair rallied to a seven-month high during early-week after the British Prime Minister Theresa May brightened chances of a no-deal Brexit in the parliament. However, lack of big political moves and no major data on the economic calendar pushed investors to trim some of their profits off the British Pound (GBP) while reassessing soft Brexit chances.

The US Dollar (USD), on the other hand, gained heavily on Thursday as an upbeat reading of the fourth quarter (Q4) gross domestic product (GDP) strengthened sentiments for the greenback amid overall upbeat session. The Q4 2018 US GDP grew beat 2.3% market consensus with a 2.6% gain.

Fed’s Powell is scheduled for a speech at 01:15 GMT in New York at the Citizens Budget Commission Awards Dinner on Friday. The title for the speech is “Recent Economic Developments and Longer-Term Challenges". Given the interesting title and a speech from important personality markets will pay attention to the news.

For the British calendar watchers, February month Markit manufacturing purchasing manager index (PMI) will be worth watching around 09:30 GMT. The monthly manufacturing gauge is expected to soften to 52.00 from the 52.8 figure marked in January.

GBP/USD Technical Analysis

Given the pair’s dip beneath 1.3280 support, chances of its decline to 1.3230 and 1.3200 during further weakness remain bright ahead of drawing bears’ attention to 1.3110.

Alternatively, an upside clearance of 1.3280 may recall 1.3300 and 1.3365 on the chart.

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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