GBP/USD News & Technical Analysis
GBP/USD trades cautiously above 1.3600 as investors await key US inflation figures for fresh direction
FUNDAMENTAL OVERVIEW:
The British Pound (GBP) remains under pressure against the US Dollar (USD) for a fourth straight session, hovering near the 1.3600 level on Friday after retreating from weekly highs above 1.3700. A cautious, risk-off tone in global markets is supporting the Dollar’s rebound, while trading activity remains subdued ahead of the US Consumer Price Index (CPI) release.
January’s headline inflation is projected to rise by 0.3% month-on-month, with the annual rate expected to ease to 2.5% from 2.7%. Core CPI, which excludes food and energy, is also forecast to moderate to 2.5% year-on-year from 2.6%. A sharper-than-expected slowdown in inflation could revive expectations for near-term Federal Reserve rate cuts, potentially weighing on the USD.
On the domestic front, disappointing UK GDP data added further pressure to Sterling. The economy expanded just 0.1% in Q4 and 1% year-on-year, missing forecasts of 0.2% and 1.2%, respectively. Weakness in manufacturing and stagnation in services output underscored broader economic fragility, reinforcing expectations that the Bank of England may need to adopt a more growth-supportive stance.
GBP/USD TECHNICAL ANALYSIS DAILY CHART:
Technical Overview:
GBP/USD is trading within an up channel.
GBP/USD is moving above all the Moving Averages (SMA).
The Relative Strength Index (RSI) is in Buying Zone, while the Stochastic oscillator suggests Neutral trend.
Immediate Resistance level: 1.3690
Immediate support level: 1.3544
HOW TO TRADE GBP/USD
Following an extended period of bullish momentum, GBP/USD encountered notable supply at higher levels, resulting in a corrective retracement. The pullback has since guided the pair into a technically significant support zone, where renewed demand has begun to surface, facilitating a modest rebound.
As long as this support region remains intact and price action consolidates constructively, the prevailing bullish framework stays valid, maintaining the prospect of a continuation move to the upside.
TRADE SUGGESTION- LIMIT BUY– 1.3553, TAKE PROFIT AT- 1.3712, SL AT- 1.3481.
