GBP/USD sees a tepid-bounce from 1.3900

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 25, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    The bearish grip on the GBP loosened over the last hours, allowing a minor-recovery in the GBP/USD pair from the UK GDP-induced drop to 1.3900.

    GBP/USD awaits US data

    The GBP/USD pair trades modestly flat at 1.3926, looking to extend the recovery above 1.3935. The resurgence of risk-on trades on the back of the rally in London stocks as well as on a pause in the oil prices decline, rescued the GBP bulls from daily lows reached at 1.39 handle.

    Earlier this session, the cable hit new session lows of 1.3900 after the UK GDP print came in line with estimates and failed to provide the much-needed impetus to sterling. The second estimate of the UK GDP for the fourth quarter remained at 0.5% and the yearly print also confirmed 1.9% growth.

    Moving on, focus now shifts towards the US durable goods and unemployment claims data for fresh momentum on the major. While speeches from Fed’s Lockhart and Williams will be closely heard for fresh cues on the Fed rate hike outlook this year.

    GBP/USD Levels to consider

    The pair has an immediate resistance at 1.3954/63 (daily pivot & high), above which 1.3980/1.4000 (1h 50-SMA/ round number) would be tested. On the flip side, support is seen at 1.3900 (psychological levels) below which it could extend losses to towards 1.3879 (Feb 24 Low).
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