GBP/USD moves off highs as USD recovers ground

• Cable trimmed gains during US session and spiked lower after Trump’s comments.
• US President warned about imposing tariffs on European cars.

The GBP/USD pair peaked earlier today at 1.3314, the highest level since June 14. Then it lost strength and pulled back. Recently dropped to 1.3248 but quickly rebounded to the 1.3260/70 area, where it was trading.

Cable is still up for the day and most import, is it holding to yesterday’s strong gains that followed the Bank of England meeting. The 6-3 vote at the MPC triggered a rally in the pound.

Recently GBP/USD bottomed following a message from US President Trump warning about tariffs to European cars. Trump tweeted: “Based on the Tariffs and Trade Barriers long placed on the U.S. and it great companies and workers by the European Union, if these Tariffs and Barriers are not soon broken down and removed, we will be placing a 20% Tariff on all of their cars coming into the U.S.”

GBP/USD Outlook

The pair is still moving with a bearish tone on a wide perspective but in the short-term, the picture could change. On a weekly basis, the pair is unchanged and far from the lows, a “doji“ formation in the chart that could point to some consolidation or a recovery.

GBP/USD needs to hold on top of 1.3220/40 in order to keep a bullish tone. While a consolidating on top of 1.3300 (20-day moving average) could open the doors to more gains.