The British pound has recovered upside momentum against the U.S dollar, following the Federal Reserve’s decision to leave the U.S interest rate unchanged. The GBPUSD pair is now testing back towards the 1.4200 handle in early Thursday trading, after dropping to 1.4122 on Wednesday, after EU officials rejected the City of London’s Brexit blueprint. Manufacturing data is now the focus of financial markets, as traders await the release of the UK Manufacturing PMI for January and the U.S ISM Manufacturing report.
The GBPUSD pair is likely to encounter further gains while trading above the 1.4200 level, key upside resistance is found at 1.4234 and 1.4284.
Should the GBPUSD pair struggle to gain traction above the 1.4200 handle, a decline back towards 1.4154 and 1.4122 seems likely.