GBP/USD holds above 1.3700 despite USD strength
- Pound among top performers on Thursday, up also versus euro.
- GBP/USD is up for the day after losing almost two hundred pips in the previous two sessions.
The GBP/USD is hovering around 1.3720/25, up around 40 pips so far on Thursday. Cable remains above 1.3700 even as the US dollar strengthens on the back of risk aversion.
The pound is among the top performer on Thursday, rising, particularly versus the euro. The EUR/GBP broke under 0.8600 while EUR/USD is falling below 1.1800, both pairs accelerated the decline over the last hours.
The United Kingdom and the European Union appear to have improved their dispute around vaccines. European Union leaders are meeting to discuss the vaccination exports and how to speed up the process.
In the US, economic data came in better-than-expected. Initial and continuing jobless claims dropped to the lowest level in a year. GDP data from the fourth quarter was revised higher to 4.3% (annualized) from 4.1%.
The positive economic numbers did not help market sentiment in Wall Street. The Dow Jones is falling 0.40%, and the Nasdaq tumbles 1%. US bond yields are off lows, with the 10-year back above 1.60%.
Short-term levels to watch
The GBP/USD still moves with a bearish bias and Thursday’s gains are seen as corrective so far. On the upside, the next resistance is seen at 1.3750 followed by 1.3780. The critical level to surpass is 1.3800. A recovery above the last one would alleviate the bearish pressure.
On the flip side, the immediate support is seen at 1.3700, and a break lower would expose the weekly low 1.3665/70.
Technical levels