GBP/USD Price Analysis: Acceptance above 23.6% Fibo. favors bulls ahead of US Q1 GDP

FXStreet
Updated Apr 25, 2024 05:19
Mitrade

■  GBP/USD struggles to attract follow-through buying and trades in a narrow range on Thursday.

■  Reduced Fed rate cut bets and speculations about more aggressive BoE easing act as a headwind.

■  The technical setup warrants some caution before positioning for any further appreciating move.


The GBP/USD pair consolidates its strong recovery gains registered over the past two days, from the 1.2300 mark or the YTD low set earlier this week and oscillates in a range during the Asian session on Thursday. Spot prices currently trade near the 1.2465 region, unchanged for the day as traders await more cues about the Federal Reserve's (Fed) rate-cut path before placing fresh directional bets. 


Hence, the focus will remain glued to important US macro data – the Advance Q1 GDP report later today and the Personal Consumption Expenditures (PCE) Price Index on Friday. In the meantime, expectations that the Fed will delay cutting interest rates in the wake of sticky inflation continue to act as a tailwind for the US Dollar (USD). Apart from this, speculations about more aggressive policy easing by the Bank of England (BoE) undermine demand for the British Pound (GBP) and act as a headwind for the GBP/USD pair. 


From a technical perspective, acceptance above the 23.6% Fibonacci retracement level of the March-April downfall favors bullish traders and supports prospects for a further appreciating move. Hence, some follow-through strength beyond the 1.2500 psychological mark, en route to the 1.2530-1.2535 region or the 38.2% Fibo. level, looks like a distinct possibility. That said, oscillators on the daily chart are still holding in the negative territory, suggesting that the latter should act as a headwind and cap the upside for the GBP/USD pair. 


On the flip side, the 1.2425 area now seems to protect the immediate downside ahead of the 1.2400 round figure. Some follow-through selling could drag the GBP/USD pair back towards the 1.2350 intermediate support en route to the 1.2300 mark, or the YTD low touched on Tuesday. A convincing break below the latter will be seen as a fresh trigger for bearish traders and pave the way for an extension of the recent downtrend from the March swing high. Spot prices might then slide to the 1.2245 area before dropping to the 1.2200 mark.


GBP/USD daily chart


fxsoriginal


GBP/USD


Overview
Today last price 1.2465
Today Daily Change 0.0001
Today Daily Change % 0.01
Today daily open 1.2464
 
Trends
Daily SMA20 1.2529
Daily SMA50 1.2627
Daily SMA100 1.2651
Daily SMA200 1.256
 
Levels
Previous Daily High 1.247
Previous Daily Low 1.2423
Previous Weekly High 1.2499
Previous Weekly Low 1.2367
Previous Monthly High 1.2894
Previous Monthly Low 1.2575
Daily Fibonacci 38.2% 1.2452
Daily Fibonacci 61.8% 1.2441
Daily Pivot Point S1 1.2434
Daily Pivot Point S2 1.2405
Daily Pivot Point S3 1.2387
Daily Pivot Point R1 1.2482
Daily Pivot Point R2 1.2499
Daily Pivot Point R3 1.2529

* The content presented above, whether from a third party or not, is considered as general advice only.  This article should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments.

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