GBP/USD analysis: bearish potential increased, 1.4000 key

Valeria Bednarik FXStreet

GBP/USD Current price: 1.4034

Poor UK retail sales undermined Pound.
UK employment and preliminary GDP figures to be out this week.

The GBP/USD pair advanced up to 1.4144 on the back of broad dollar's weakness early Friday, yet poor UK Retail Sales figures and a resurgent greenback ahead of the weekend resulted in the pair losing over 100 pips, to close at 1.4034. UK sales volumes rose by just 0.1% in January from the previous month and 1.6% from a year earlier, well below market's expectations. Sales excluding volatile fuel prices were also tepid, up 0.1% and 1.5% respectively. Furthermore, the Office of National Statistics report indicated that in the longer-term picture, the sector shows a continued slowdown. The week with start in slow motion for the UK, with the kingdom just releasing the Rightmove House Price index on Monday. UK employment figures will be out on Wednesday, while preliminary Q4 GDP will see the light on Thursday, both set to rock the Pound. Technical readings in the daily chart lean the scale toward the downside, as the pair faltered around the 61.8% retracement of its latest daily decline, now battling with the 50% retracement and a flat 20 DMA. Indicators in the mentioned chart have lost their upward strength, the Momentum below its 100 level, and the RSI currently around 55. Shorter term, and according to the 4 hours chart, the downside potential seems limited as long as the price holds above Friday's low of 1.3996, as the pair bounced from a bullish 20 SMA, while technical indicators remain within positive territory, with the RSI aiming to regain the upside around 55.

Support levels: 1.3995 1.3960 1.3920

Resistance levels: 1.4070 1.4110 1.4140

View Live Chart for the GBP/USD

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

EUR/USD hits two-day highs near 1.1820

EUR/USD picks up pace and reaches two-day tops around 1.1820 at the end of the week. The pair’s move higher comes on the back of renewed weakness in the US Dollar amid growing talk that the Fed could deliver an interest rate cut as early as March. On the docket, the flash US Consumer Sentiment improves to 57.3 in February.

GBP/USD reclaims 1.3600 and above

GBP/USD reverses two straight days of losses, surpassing the key 1.3600 yardstick on Friday. Cable’s rebound comes as the Greenback slips away from two-week highs in response to some profit-taking mood and speculation of Fed rate cuts. In addition, hawkish comments from the BoE’s Pill are also collaborating with the quid’s improvement.

Gold climbs further, focus is back to 45,000

Gold regains upside traction and surpasses the $4,900 mark per troy ounce at the end of the week, shifting its attention to the critical $5,000 region. The move reflects a shift in risk sentiment, driving flows back towards traditional safe haven assets and supporting the yellow metal.

Crypto Today: Bitcoin, Ethereum, XRP rebound amid risk-off, $2.6 billion liquidation wave

Bitcoin edges up above $65,000 at the time of writing on Friday, as dust from the recent macro-triggered sell-off settles. The leading altcoin, Ethereum, hovers above $1,900, but resistance at $2,000 caps the upside. Meanwhile, Ripple has recorded the largest intraday jump among the three assets, up over 10% to $1.35.

Three scenarios for Japanese Yen ahead of snap election

The latest polls point to a dominant win for the ruling bloc at the upcoming Japanese snap election. The larger Sanae Takaichi’s mandate, the more investors fear faster implementation of tax cuts and spending plans.

XRP rally extends as modest ETF inflows support recovery

Ripple is accelerating its recovery, trading above $1.36 at the time of writing on Friday, as investors adjust their positions following a turbulent week in the broader crypto market. The remittance token is up over 21% from its intraday low of $1.12.