Pound Rallies To Seven-Week High After UK Inflation News
The GBP/USD pair surged to a fresh 7-week high of 1.5716, with the Pound getting a boost from the UK inflation figures that surprised to the upside.
The pair however, eased down to 1.5643 during the American afternoon, from where its slowly grinding back higher.
Technically, the 1 hour chart shows that the technical indicators are resuming their advance after correcting extreme overbought readings, whilst the 20 SMA gained bullish slope below the current level, and offers now an intraday support around 1.5630.
In the 4 hours chart the price has recovered from a horizontal 200 EMA and broke through its 20 SMA , whilst the technical indicators are also resuming their advances after correcting lower. A new advance beyond 1.5690 should lead to a test of the 1.5733 level, July monthly high, whilst beyond this last, 1.5770 is the next probable bullish target for Wednesday.
Meanwhile the GBP/CAD surged to a daily high of 2.0586. But the cross gave back most of its intraday gains, as surging oil prices boosted a recovery in the Canadian dollar by the end of the day.
The pair however, closed the day in the green and above its 20 DMA, maintaining its latest positive tone.
Short term, the 1 hour chart shows that the price is below its 20 SMA, whilst the technical indicators have retreated from overbought territory and aim lower around their mid-lines, suggesting the decline may extend in the short term.
In the 4 hours chart, the price is hovering around a mild bullish 20 SMA, whilst the technical indicators also head lower around their mid-lines, supporting the shorter term view, particularly on a break below 2.0410, the immediate support.