GBP/USD holds steady near 1.2965 post US data

The GBP/USD pair Having spiked to fresh one-month high just above the key 1.30 psychological mark, the GBP/USD pair seems to have entered a consolidation phase and had a muted reaction to the US economic data. 

The pair moved little and held near 1.2970-60 region after the final US GDP growth figure was revised higher to show a growth of 1.4% for the first quarter of 2017 as against 1.2% estimated earlier. 

The positive effect, however, to some extent seems to have been negated by a modest rise in weekly jobless claims, coming in at 244K for the week ended June 23 as compared to 240K expected and last week’s 242K (revised higher from 241K). 

Although today’s mixed economic data did little to change the bearish sentiment surrounding the US Dollar but did provide some immediate respite and collaborated towards keeping the GBP/USD pair below the 1.30 handle.

With the US economic data out of the way, traders now look forward to St. Louis Fed President James Bullard's speech for some fresh impetus later during the NY session.

Technical outlook

Valeria Bednarik, Chief Analyst at FXStreet writes: "From a technical point of view, the pair is extremely overbought, but while the price keeps advancing, indicators have lost upward strength, beginning to neutralize yesterday's sudden advance in the 4 hours chart. The 20 SMA in the mentioned chart maintains a strong upward slope after crossing above the 200 EMA, both far below the current level."

"Beyond the 1.3000 threshold, the pair has a strong static resistance around 1.3040/50, where the pair met selling interest multiple times last May and the highest for this year. Beyond it, 1.3100 is the next possible bullish target for today. The immediate support comes at 1.2960, while below it, the pair can correct down to 1.2920 short term" she adds further.