GBP/USD rises above 1.4120 as the US dollar losses momentum
- Pound gains momentum and prints fresh highs versus dollar, turns positive against euro.
- DXY back into negative territory, it drops to 90.20.
The GBP/USD is rising for the second day in a row and recently it printed a fresh high at 1.4125, boosted by a weaker dollar and also by a retreat in EUR/GBP. During the American session the dollar lost momentum and pulled back, even as stocks declined in the Wall Street and amid steady yields.
Cable is breaking the upper limit of an intraday range that capped the upside for hours, around 1.4115. A consolidation above 1.4100 would keep the bullish bias intact. The next resistance might be seen at 1.4130 followed by 1.4155.
On the flip side, the short-term critical support stands at 1.4075, the daily low that was testes on American hours but it held. A break lower would expose the next support at 1.4055.
Economic data from the US on Monday had no impact on the market. The Empire manufacturing index dropped less than expected in May while the NAHB Housing Index remained at 83 as expected. The key event in the US this week will be the FOMC minutes on Wednesday.
In the UK, on Tuesday Labor market data is due, inflation on Wednesday and April retail sales on Friday. The reports could have an impact on the pound.
Technical levels