Valeria Bednarik, chief analyst at FXStreet explained that the GBP/USD pair advanced up to 1.4282, the highest since last Tuesday, fuelled by poor US data.
Key Quotes:
“The Sterling saw some limited demand at the beginning of the day, as most European and Asian markets were closed on holiday, but downbeat US PCE inflation boosted the advance up to the mentioned high.
There were no macroeconomic releases in the UK, and the calendar will remain empty until the release of GDP figures on Thursday, which means that the pair will be largely driven by dollar’s self strength/weakness.
The upward potential is still quite limited, given that in the 4 hours chart, the pair met selling interest around its 200 EMA, whilst the technical indicators have lost their bullish strength after recovering above their mid-lines.
Furthermore, the recovery stalled around the 50% retracement of its latest bearish run, and the price is currently resting above the 38.2% retracement of the same rally, at 1.4230, the immediate support.
A break below this last, should see the pair returning to the lower band of the 1.4100 level, which will also increase the risk towards the downside, eyeing levels below the 1.4000 figure for later on this week.
(Market News Provided by FXstreet)
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