GBP/USD lethargic ahead of major event risk

FXstreet.com (Athens) – The GBP/USD has been trading sidelines and well capped by the 1.5900 handle ahead of the UK inflation report, jobs data, Carney’s speech.

GBP/USD sits on the fence; pound at risk on hawkish BoE Inflation report

The GBP/USD has been caught today amidst a very confined area, lacking of the fundamental catalyst that would give the cross a solid momentum. However, ahead of us the focus is now shifting to BOE report and the British jobs data due later in the session. Elaborating on, while it widely assumed that the Canadian BoE’s Governor Carney will rein in the optimism surrounding the U.K. economy, the BoE might resort to a very hawkish stance, as the stronger recovery raises the risk for a prolonged period of above-target inflation.

Technical Perspectives on the GBP/USD

Downwards, traders should pay much attention the area as of 1.5710-1.5720 as there is laying the 38.2% of the Fibonacci retracement of the uptrend movement as of the 10th July’s low (1.4843) to the 1.6245 (25th October’s high). In case the 38.2% Fib. is breached, then the cross might dragged down in an abruptly movement. Interim Support: 1.5900 Pivot to 1.5910 (78.6% Fibonacci expansion), while interim resistance can be found at 1.6250 Pivot to 1.6300 Pivot (2012 highs).

Session recap: Data pushed aside as “risk-off” attitude takes over

The global attitude toward risk took a hit early Wednesday after disappointment grew following the Chinese Plenum meetings. Asian stocks fell as analysts and strategists came away disappointed by the lack of details attached to Chinese leaders’ rhetoric about the future of the Chinese economy as it transitions from a majority state-run to a majority private-sector-run. The bad equity performance has money seeking “safety” in the currency markets – including and especially in the Yen.
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USD/CHF pulling back & hovering just above 1st Fibonacci support at 0.9163

With very limited data flow to influence the USD/CHF cross Wednesday, traders will be relying primarily on technical forces to determine direction.
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