• GBP/USD climbed to over a one-week high on Monday amid modest USD weakness.
  • Dovish BoE expectations, Brexit woes acted as a headwind and capped the upside.
  • Investors now look forward to the US economic data for short-term opportunities.

The GBP/USD pair gained some positive traction on Monday and shot to over a one-week high during the early part of the European session. Spot prices, however, struggled to capitalize on the move or find acceptance above the 1.2300 mark and have now surrendered a major part of the intraday gains.

The recent slump in commodity prices seems to have eased worries about the persistent rise in inflation and forced investors to scale back expectations for a more aggressive policy tightening by the Fed. Apart from this, a goodish recovery in the global risk sentiment - as depicted by a generally positive tone around the equity markets - undermined the safe-haven US dollar. This, in turn, was seen as a key factor that offered some support to the GBP/USD pair, though the uptick lacks bullish conviction.

The incoming softer UK macro data has raised concerns over British economic growth and fueled recession fears. This, along with expectations that the Bank of England will opt for a more gradual approach towards raising interest rates, has held back traders from placing aggressive bullish bets around the British pound. Apart from this, the UK-EU impasse over the Northern Ireland Protocol of the Brexit agreement further contributed to capping gains for the GBP/USD pair, at least for the time being.

Hence, it will be prudent to wait for strong follow-through buying beyond last week's swing high, around the 1.2325 region, before positioning for any further gains. Market participants now look forward to the US economic docket, featuring the release of Durable Goods Orders and Pending Home Sales data. This, along with the US bond yields and the broader market risk sentiment, might influence the USD price dynamics and produce short-term trading opportunities around the GBP/USD pair.

Technical levels to watch

GBP/USD

Overview
Today last price 1.2283
Today Daily Change 0.0014
Today Daily Change % 0.11
Today daily open 1.2269
 
Trends
Daily SMA20 1.2375
Daily SMA50 1.2482
Daily SMA100 1.2872
Daily SMA200 1.3191
 
Levels
Previous Daily High 1.232
Previous Daily Low 1.2241
Previous Weekly High 1.2324
Previous Weekly Low 1.2161
Previous Monthly High 1.2667
Previous Monthly Low 1.2155
Daily Fibonacci 38.2% 1.229
Daily Fibonacci 61.8% 1.2271
Daily Pivot Point S1 1.2233
Daily Pivot Point S2 1.2197
Daily Pivot Point S3 1.2154
Daily Pivot Point R1 1.2313
Daily Pivot Point R2 1.2357
Daily Pivot Point R3 1.2393

 

 

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. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news Join Telegram

Recommended content


Recommended content

Editors’ Picks

EUR/USD retreats from multi-week highs, holds above 1.0300

EUR/USD retreats from multi-week highs, holds above 1.0300

EUR/USD has retreated modestly after having touched its highest level in over a month above 1.0360. With the greenback struggling to find demand following the soft July inflation data, however, the pair holds above 1.0300 and looks to post strong daily gains.

EUR/USD News

GBP/USD consolidates gains below 1.2250

GBP/USD consolidates gains below 1.2250

GBP/USD retraced a small portion of its impressive daily rally during the American trading hours but remains on track to register its largest one-day gain since early June. The lower-than-expected July CPI data from the US weighed heavily on the dollar mid-week. 

GBP/USD News

Gold tries to claim $1,800 amid falling US yields

Gold tries to claim $1,800 amid falling US yields

After having failed to reclaim $1,800 with the initial reaction to the soft July inflation data from the US, gold is attempting to break above that key level. The benchmark 10-year US Treasury bond yield is down nearly 1% on the day, helping XAU/USD push higher.

Gold News

Crypto markets tumble, but the worst is yet to come

Crypto markets tumble, but the worst is yet to come

Bitcoin price is trying to undo the gains it witnessed over the last week and is currently at the midway point. This sell-off has caused Ethereum and Ripple prices to follow suit, pausing the rallies that altcoins were experiencing.

Read more

FXStreet Premium users exceed expectations

FXStreet Premium users exceed expectations

Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!

BECOME PREMIUM

Forex MAJORS

Cryptocurrencies

Signatures