GBP/USD struggling for direction below 1.2400

The Sterling is navigating a narrow range vs. the buck at the beginning of the week, taking GBP/USD to the 1.2390/95 band for the time being.

GBP/USD looks to risk trends

After three consecutive advances, the pair seems to be looking for a stronger catalyst other than USD-weakness to extend the upside further north of the 1.2400 handle.

The domestic front stays unchanged so far, with market participants keep waiting for UK’s PM Theresa May to finally trigger Article 50 after the recent developments from both the House of Lords and the House of Commons.

From the positioning front, GBP speculative net shorts have climbed to record highs during the week ended on March 14 above 107K contracts according to the latest CFTC report.

Absent releases in the UK docket today, GBP should be mainly driven by the broad risk appetite trends while keeping an eye on the speech by BoE’s A.Haldane later in the evening. In the US data space, the Chicago Fed National Activity Index is due along with the speech by Chicago Fed C.Evans (voter, dovish).

GBP/USD levels to consider

As of writing the pair is losing 0.06% at 1.2389 facing the next support at 1.2321 (low Mar.17) followed by 1.2319 (20-day sma) and then 1.2239 (low Mar.16). On the flip side, a breakout of 1.2406 (high Mar.17) would aim for 1.2413 (100-day sma) and finally 1.2572 (high Feb.24).