The British Pound remains one of the biggest beneficiaries on changing perceptions over US inflation and rates managing to see two year highs against the US Dollar and Euro. Note we will be seeing the next critical data for the US Tuesday with Retail Sales on the line and should we see weak numbers likely furthering the dollar dumping spree. That said UK CPI will be out Wednesday with consensus at 1.9% slightly under the 2.0% target. Given the extent of GBPUSD’s rally imagine what a strong US Retail Sales and weak UK CPI could lead to.
Resistance
- 1.31421 – High for 2023
- 1.30509 – Intraday Consolidation Low 2023
- 1.29908 – Friday’s High
Support
- 1.29485 – Intraday Consolidation High
- 1.28970 – Intraday Consolidation Floor
- 1.28605 – High From June
GBPUSD opened with a bearish gap after a two week rally that ended with a new two year high. It’s always a bad idea to stand in front of a runaway freight train. That said we have key releases coming out of the US and UK the next two days opening the possibility of a technical correction. Our preferred strategy would be to buy any dips towards the June High of 1.28605 price point and watch the data for status quo. More immediate we can consider shorting on a break of 1.29485 with limited expectations.
