‘The market is bid above the 55 day ma at 1.2417 and the near term risk remains on the topside. We suspect that prices will need to go sub 1.2250 in order to alleviate immediate upside pressure. Support at 1.2250 guards the 1.1988/80 recent low.’ – Commerzbank (based on FXStreet)
In spite of a strong UK GDP reading, the GBP/USD currency pair was unable to pierce the immediate resistance cluster, resulting in a small bearish correction, with a slip below 1.26 again. The same cluster keeps providing strong resistance today around 1.2670, implying that the Pound is to weaken against the US Dollar for the second day. The nearest demand area rests around 1.2515, which could limit possible losses, while another strong group supports is located at 1.2430, namely the monthly PP and the 55-day SMA. However, technical indicators in the daily timeframe suggest the Cable is to inch higher; nevertheless, the immediate resistance is expected to remain intact.
Traders’ sentiment remains bullish at 62%, while the portion of purchase orders edged higher over the day, namely from 46 to 51%.