GBP/USD tests Thursday’s high and retreats, near 1.44

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 29, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    FXStreet (Mumbai) - The British pound regained lost ground versus its American rival in early Europe, with GBP/USD retreating slightly from Thursday’s high.

    GBP/USD still above all major MAs on hourly sticks

    The GBP/USD pair trades 0.27% higher at 1.4403, easing-off fresh session highs reached at 1.4414 some minutes ago. The cable trades firmer at two-week highs as the sentiment remains underpinned on the back of Thursday’s upbeat UK GDP print as well as on rebounding oil prices. Both crude benchmarks are extending the rally by over 2%, at the moment.

    Also, the risk-on rally seen in the Asian equities after the BOJ rate cut decision also keeps the demand for higher-yielding currencies alive, and hence, markets bid up sterling at the expense of the buck. However, the upside in the GBP/USD pair remains capped as the greenback remains strongly bid across the board, thanks to the extensive rally in USD/JPY post-BOJ and Kuroda’s comments.

    Later today, amid a data-empty UK docket, attention now remains on the main risk event for the day, the US advance GDP data.

    GBP/USD Levels to consider

    The pair has an immediate resistance at 1.4437/46 (daily R1/ Jan 14 High), above which 1.4500 (round number) would be tested. On the flip side, support is seen at 1.4334/ 33 (daily low & pivot) below which it could extend losses to towards 1.4294 (1h 100-SMA).
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