GBP/USD rebounds sharply to test 1.2450

Despite, persistent generalized demand for the US dollar, the GBP/USD pair took a sharp U-turn from just ahead of 1.24 handle and staged a solid comeback in a bid to test 1.2450 levels.

The bulls were rescued by heavy losses seen in EUR/GBP cross amid aggressive EUR selling, which prompted a fresh bounce in cable.

However, a broadly higher US dollar combined with Eurogroup President Dijsselbloem latest comments signalling a Hard Brexit, could keep any recovery short-lived. Dijsselbloem noted earlier today that the UK must pay Brexit bill before trade talks begin.

All eyes now remain on the US final GDP data and Fedspeaks for further momentum on the prices.

GBP/USD Levels to consider            

Slobodan Drvenica, Information & Analysis Manager Windsor Brokers Ltd noted, “At the upside, daily cloud top at 1.2473, reinforced by Tenkan-sen line, marks the first upper trigger, with extension above 1.2500 (top of hourly Ichimoku cloud that caps near-term action) needed to signal stronger upside attempts. On the downside, loss of 1.2420/13 pivots would risk fresh weakness towards lower triggers at 1.2360/56 (daily Kijun-sen / cloud base) and signal bearish continuation on firm break lower. Res: 1.2466; 1.2473; 1.2500; 1.2522Sup: 1.2414; 1.2395; 1.2356; 1.2338.”