GBP/USD: Upside risk hinges on 1.3480 close – UOB

FXStreet Insights Team FXStreet

United Overseas Bank’s (UOB) economists Quek Ser Leang and Lee Sue Ann highlight a still-positive short-term outlook for GBP/USD after recent gains above 1.3450. They see scope for the Pound (GBP) to advance toward 1.3520, but stress that a daily close above 1.3480 is required. Strong support has been raised to 1.3330, while intraday trade is expected within a 1.3390–1.3465 range.

Pound needs confirmation above resistance

"On Wednesday (08 Apr, spot at 1.3400), we indicated that “while the short-term rally appears overdone, there is scope for GBP to rise to 1.3480.”"

"After GBP soared to 1.3485 and then pulled back, we highlighted yesterday (09 Apr, spot at 1.3390) that “the upside risk remains intact, but GBP must close above 1.3480 before a move to 1.3520 can be expected.”"

"We added, “the likelihood of GBP closing above 1.3480 will remain intact as long as 1.3280 (‘strong support’ level) continues to hold.”"

"Our view remains unchanged, but we are revising the ‘strong support’ level to 1.3330 from 1.3280."

"Today, GBP could edge higher, but any advance is likely part of a higher range of 1.3390/1.3465."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

GBP/USD holds above 1.3350 with the 200-day SMA capping gains

The British Pound appreciates against the US Dollar on Tuesday to trim previous losses and return to the 1.3375 area, aiming to retest resistance at the key 200-day Simple Moving Average. This is a popular indicator, which lies a few pips below 1.3400 and has been capping Pound’s recovery over the last two weeks.

EUR/USD consolidates gains above 1.1400

Following an earlier move to multi-day peaks past 1.1460, EUR/USD has now slipped back toward the low 1.1400s as the NA session draws to a close on Tuesday. Declining bets for potential Fed tightening later in the year coupled with poor US CPI data hurt the US Dollar, lending fresh legs to the pair and the broader risk-linked universe. Moving forward, the release of US PPI and Chair Warsh’s second testumony should keep investors entertained on Wednesday.

Gold climbs to near $4,050 on softer US CPI

Gold price rises to around $4,050 during the early Asian session on Wednesday. The precious metal rebounds as softer-than-expected US inflation data boosted hopes of the US Federal ‌Reserve adopting a less hawkish stance.

Ethereum climbs 7% amid declining inflation, weak retail and whale participation

Ethereum jumped more than 7% above $1,850 on Tuesday following a weaker-than-expected US Consumer Price Index report for June. The inflation data fell to 3.5% below expectations of 3.8%, marking a month-on-month decline of 0.4%, its largest monthly drop since May 2020. Core CPI also fell to 2.6% below forecasts of 2.8%.

Fed Chair Warsh reaffirms they will deliver price stability

While testifying on the Semiannual Monetary Policy Report before the US House Financial Services Committee, Fed Chairman Kevin Warsh reiterated that the Fed is making a commitment on price stability and the goal of 2% inflation.

Five sessions, one round trip: Why the whipsaw is exactly what Warsh ordered

Markets opened July with a December hike as the base case and spent five trading sessions unlearning and relearning it. A 57K payrolls print bled the tightening bets out of the strip; a re-shut Strait of Hormuz is pushing them back in. Wednesday's minutes from the June FOMC meeting landed mid-round-trip, describing a world that had already stopped existing.