• A modest USD pullback from near two year tops extends some support.
• The lack of progress in the cross-party Brexit talks seemed to cap gains.
• Today’s key focus will be on the release of advance US Q1 GDP report.
The GBP/USD pair traded with a mild positive bias through the early European session, albeit struggled to make it through the 1.2915-20 immediate resistance.
The pair stalled its recent bearish slide on Thursday and managed to find some support near the 1.2865 region amid a modest US Dollar pullback from the highest level since May 2017, despite the upbeat release of the US durable goods orders.
The USD bulls remained on the defensive on the last trading day of the week and turned out to be one of the key factors lending some support to the major, though the lack of progress in the UK cross-party talks to break the Brexit deadlock kept a lid on any meaningful up-move.
As Yohay Elam, FXStreet’s own Analyst writes: “There has been no breakthrough in talks between the government and the opposition, but negotiations continue, contrary to reports that they are on the verge of collapse.” “Time is passing by without any developments, confirming that the UK will participate in the European Parliament elections in late May. The government wanted to avoid it,” he added further.
Investors also seemed reluctant to place any aggressive bets ahead of today’s important release of the US Q1 GDP report, due later during the early North-American session, which further collaborated to the pair’s subdued/range-bound price-action.
The annualized US economic growth is seen easing a bit to 2.1% from the previous quarter’s final reading of 2.2%. Any meaningful deviation from the expected figures might influence expectations about the Fed’s outlook and eventually provide some fresh directional impetus.
Technical levels to watch
Yohay Elam offers important technical levels to watch ahead of today’s important releases: “Resistance awaits at 1.2920 that held cable down earlier in the day. 1.2960 was the low point in March and a swing high earlier this week. 1.3020 held the pair down beforehand. Initial support awaits at 1.2865, the fresh two-month low. Further down, 1.2830 was a support line in early February. It is followed by 1.2775 that was the low point that month. 1.2675 is next.”