GBP/USD sticks to UK data-led gains above 1.29
The GBP/USD corrected last week's gains on Monday and started another bullish move on Tuesday after the manufacturing PMI in the United Kingdom came in above expectations. The pair rose to a daily high at 1.2928 and has been able to hold on to its daily gains around that level. At the moment, the pair is trading at 1.2921, up 0.28% on the day.
The manufacturing PMI from the UK rose to 57.3 in April from 54 in March, beating the consensus of 54.2. Despite the strong data, the renewed concerns surrounding the Brexit process discouraged the GBP bulls and the pair struggled to extend its gains.
- EU spokesman Schinas: Difficulty in Brexit talks has been underestimated
There are no data scheduled for release in the remainder of the NA session and investors may choose to stay on the sidelines until tomorrow's important Fed interest rate decision and the monetary policy statement. Earlier in the day on Wednesday, the construction PMI from the U.K. will also be watched closely but it's unlikely to receive a heavy reaction ahead of Fed. The US Dollar Index is also directionless in a tight range around 99 in the session.
Technical outlook
The pair could encounter the first resistance at 1.2955/60 (Apr. 28 high/Oct. 4 high) ahead of 1.30 (psychological level) and 1.3055 (Sept. 28 high). On the downside, supports are located at 1.2900 (psychological level), 1.2840 (Apr. 27 low) and finally 1.2760 (Apr. 21 low).
- GBP/USD stays bid near term – Commerzbank