- Sterling continues to lift as Greenback continues to bed down across the broader markets.
- GBP/USD traders may be looking towards further Brexit developments to come next week.
The GBP/USD is trading higher in the early European session, testing into 1.3440 ahead of a quiet Thursday that will see focus shift to US jobless claims.
The Sterling has been on a steady lift for two weeks after bottoming out at 1.3204, a six month low as a worse-than-expected downturn in UK economic figures has knocked the Pound down for the first quarter of 2018, and forcing the Bank of England (BoE) off of their hawkish perch, forcing the central bank to walk back their anticipated May rate hike. The BoE is now on pace for a rate hike sometime in the 3rd quarter, and economic data is beginning to recover after a sharp contraction in the first quarter that was blamed on bad weather.
Little of note is on the economic data docket for Thursday in the UK, and trader focus is going to be moving onto the US jobless claims due at 12:30 GMT, and both Continuing and Initial Jobless Claims are expected to tick up slightly, with continuing claims expected at 1.738 million (prev. 1.726 million) and Initial Jobless Claims forecast at 225 thousand (prev. 221 thousand).
GBP/USD levels to watch
The GBP/USD is lifting higher but is edging into major resistance according to FXStreet’s Chief Analyst Valeria Bednarik: “the 1.3450 region, where it has multiple daily highs and lows from these last few months. A clear break of the resistance area is needed for the Pound to extend its gains, although investors may wait for next week data and Brexit news before taking firmer positions in the pair. Short term, and according to the 4 hours chart, the pair is developing above a firmly bullish 20 SMA, but still far below its 200 EMA, this last at 1.3525. Technical indicators have retreated within positive territory with uneven strength, as the Momentum nears its mid-line while the RSI holds near overbought readings, anyway not enough to suggest an upcoming downward move.”
Support levels: 1.3395 1.3360 1.3320
Resistance levels: 1.3450 1.3490 1.3530
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