GBP under pressure!
By: Ahura Chalki
Market analyst – IFC Markets
Cable back under 1.3750 amid greenback come back from yesterday low, with the raising of U.S. Treasury yields rises to 1.690%. Risk-off mood also benefits the dollar’s demand.
Narrow and range trading of GBPUSD also is for another reason. Today is an important day for the U.K., as we are waiting for GDP, Manufacturing, and Industrial production. Especially right after the reopenings, which started yesterday. The pair was last seen trading at 1.3733, down 0.05% on Tuesday.
A brighter view of the U.S. economy with massive government stimulus and better than expected progress in vaccination, while the E.Z. is still suffering from a delay in vaccination progress, supports the USD demand. “The U.S. economy could see a significant rebound this year thanks to accommodative monetary and fiscal policy, but the labor market still has much room for improvement, Boston Federal Reserve Bank President Eric Rosengren said on Monday.” (Reuters)
For today and Cable traders, besides mentioned data from the U.K., we have to care about vital CPI data from the U.S. U.K.’s reopening also supporting the pound. Simultaneously, the monthly GDP is foreseen at 0.6% MoM in February, improving from -2.9%, and it can be a good improvement for the U.K. economy at the moment, before reopenings.
Technical overview – Short-term
Cable is currently trading at a significant level of 1.3730 and between 20 and 50 HMA. CCI moves under the -100 level, ATR is very low, and Stochastic is still moving lower. As long as the pair holds below the Pivot level at 1.3725, the risk is skewed to the downside.
Support levels: 1.3700 – 1.3675 – 1.3620
Resistance levels: 1.3785 – 1.3834 – 1.3890
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