GBP/USD: Recovery capped by 1.4245, back to 1.4200
- Pound among worst performers on the back of UK CPI and Brexit.
- GBP/USD down 200 pips from yesterday’s high.
The recovery of the GBP/USD pair lost momentum during the last hours as the pound weakened again, this time after the UK upper house an amendment that challenges PM May’s Brexit policy of not remain in a customs union with the European Union after Brexit. The bill will return to the House of Commons. Previously UK data pushed the currency sharply lower.
UK Inflation showed lower than expected numbers for March and the lowest reading in a year. Cable dropped dramatically to 1.4172, reaching a 6-day. Then moved off lows supported by a retreat of the US Dollar. The recovery was capped by the 1.4245 area and as of writing, it was trading at 1.4205/10, down 75 pips for the day.
In the US, the Federal Reserve just released the Beige Book with no significant impact on the market. According to the document, the economy continued to expand at a modest-to-moderate pace.
The greenback is posting mix results across the board but the pound is the clear loser of the session. On Thursday, retail sales data is due in the UK.
GBP/USD Technical levels
The pair is falling for the second-day in-a-row accumulating a retreat of 200 pips from yesterday’s high at 1.4375. To the downside, support levels might be located at 1.4205, 1.4170/75 (Apr 18 low) and 1.4140. On the upside, the immediate resistance could be seen at 1.4250, 1.4280 (Apr 17 low) and 1.4315.