- GBP / USD continues to be pressured by a pessimistic BOE and by concerns about the Delta variant of the covid.
- Thursday’s close below the 100 DMA keeps sellers hopeful.
- The pound ignores the weakness of the US dollar ahead of the PCE inflation data.
GBP / USD is struggling to resist above the 1.3900 level as the dovish surprise from the Bank of England (BOE) continues to undermine sentiment around the pound.
The persistent slow moves in the US dollar amid mixed signals from the Fed and weak economic data are not inspiring the bulls either.
Furthermore, pound traders are also not taking advantage of the improving Brexit situation, especially after UK Environment Secretary George Eustat, said Thursday: “I think we are getting some positive signs and it is always better if we can come to an agreement with the European Union on these things.”
Markets are now looking forward to critical inflation data from the US PCE for further signs of the Fed’s next policy move, which is likely to have a significant impact on the greenback, which in turn may move GBP / USD. .
GBP / USD Technical perspective
From a short-term technical perspective, the daily close of the pound below the 100-day moving average (DMA) at 1.3951 has opened the doors for the next downtrend towards the upward sloping trend line support at 1.3793.
The 14-day Relative Strength Index (RSI) skirts the bottom while below the midline, allowing room for further declines.
Daily chart GBP / USD
On the other hand, any bounce will meet initial resistance at the aforementioned 100 DMA barrier, above which the slightly bullish 50 DMA on 1.4036 could be challenged.
However, the bulls need to be accepted above 1.4000 as it is critical to unleash additional rallies.
Additional GBP / USD levels to view
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