- The pound again fails to stay above 1.4200 and corrects lower.
- GBP / USD continues to move in a consolidation range between 1.4100 and 1.4200.
The GBP/USD it bottomed ahead of the US data release at 1.4135 amid a rally in the US dollar across the board. Subsequently, the dollar lost steam favoring a rebound on the cable back above 1.4150.
The intraday bias is still pointing to the downside in GBP / USD, but the downward pressure eased significantly. US economic data mostly beat expectations. At first, the US dollar extended gains and then fell back, amid a drop in US yields.
The pound’s rebound has been more limited than other currencies. Despite GBP / USD moving away from lows, EUR / GBP rose again above 0.8600, reflecting some weakness in the British currency.
The DXY is far from highs. Earlier on Friday, it peaked at 90.45, the highest level since May 17 and is moving towards 90.10. At the same time, the 10-year yield fell to 1.58% after testing the 1.62% area for hours.
From a technical perspective, GBP / USD continues to move sideways, in a consolidation range. Despite the first close above 1.4200 in years on Thursday, the pair was unable to hold and pulled back. It needs a clear break above 1.4250 to open the doors for more gains. On the other hand, the key support is the 1.4100 area. A close below would suggest a gradual correction going forward.