GBP/USD bulls catch a breather amid two-day winning streak. Risk-on mood triggered US dollar pullback from multi-day top. Beijing’s sanctions, EU-UK tussle over vaccine and Brexit gain a little attention. UK Retail Sales can help extend the recovery, US Core PCE also in focus. Following its run-up to 1.3765 during the early Asian session, GBP/USD wavers around 1.3750, easing to 1.3760 by the press time, while heading into the London open on Friday. Even so, the cable prints 0.17% intraday gains while extending the previous day’s run-up. Although vaccine optimism and upbeat expectations from the UK Retail Sales seem to give background music to the latest run-up, it’s the US dollar’s pullback that plays a major role. The US dollar index (DXY) steps back from early November tops as market sentiment improves. Behind USD moves, hopes of further stimulus and President Joe Biden’s push for faster vaccinations, as well as upbeat US data, could be cited as major catalysts. Also positive could be comments from the Fed policymakers who keep rejecting reflation fears and convince markets about extended easy money policies. On the other hand, the European Union (EU) eyes “win-win” situations on the AstraZeneca covid vaccine when discussing terms with the UK. However, Brussels is less friendly on the fisheries to Britain and also warns over further economic hardships to exert pressure. Further, the Northern Ireland (NI) conditions keep worsening as the bloc recently renewed terms for loans to the UK-friendly region’s businesses. It’s worth mentioning that the UK-China tussle brews as Beijing sanctions British institutions, lawyers and diplomats over Xinjiang issues, per The Guardian. However, British exports of meat and fishing products suggest a recovery in February, per Reuters quoting the UK diplomat, whereas the Confederation of British Industry (CBI) upbeat Retail Sales in March even as February couldn’t please the bulls. The same is the case with the UK’s car production that dropped 14% in February and joined the recently mixed British fundamentals. Against this backdrop, S&P 500 Futures rise 0.30% whereas US 10-year Treasury yields add 1.8 basis points to stay above 1.60%. Further, the US dollar index (DXY) eases from the fresh multi-day high marked the previous day. Looking forward, UK’s Retail Sales for February is expected to keep the market optimism on the desk but fears of the US dollar bull’s return can’t be ruled out. “We look for retail sales to bounce a bit from the -8.2% m/m decline that we saw in January, which ended up being worse than the most pessimistic economist forecast. For February, we look for a 3% m/m gain (market forecast 2.1%), as mobility picked up a bit and it appears that some businesses began reopening after a January hibernation. This, however, would still leave the level of retail sales about 9% below its recent October 2020 peak,” said TD Securities. Read: The February Grab-Bag Preview: Personal Income, Spending, Core PCE Prices and GDP Technical analysis A horizontal area comprising lows marked since February 12, around 1.3775-80, guards the cable’s immediate upside ahead of 50-day SMA near 1.3830. Meanwhile, sellers will wait for a fresh monthly low under 1.3670 for re-entry. Trend: Pullback expected FX Street FX Street FXStreet is the leading independent portal dedicated to the Foreign Exchange (Forex) market. It was launched in 2000 and the portal has always been proud of their unyielding commitment to provide objective and unbiased information, to enable their users to take better and more confident decisions. View All Post By FX Street FXStreet News share Read Next EUR/GBP Price Analysis: Well-offered below 200-SMA, UK-EU data in focus FX Street 1 year GBP/USD bulls catch a breather amid two-day winning streak. Risk-on mood triggered US dollar pullback from multi-day top. Beijing's sanctions, EU-UK tussle over vaccine and Brexit gain a little attention. UK Retail Sales can help extend the recovery, US Core PCE also in focus. Following its run-up to 1.3765 during the early Asian session, GBP/USD wavers around 1.3750, easing to 1.3760 by the press time, while heading into the London open on Friday. Even so, the cable prints 0.17% intraday gains while extending the previous day's run-up. 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