GBP/USD eases below 1.3800 amid steady USD, UK Retail Sales eyed

GBP/USD pares initial gains on Friday in the Asian trading hours.
Higher US Treasury yields shield the underperformance of the US dollar.
Mixed play of US debt deal, Brexit headlines ahead of critical UK/US data to set the tone for the day.

Rekha Chauhan Independent Analyst

GBP/USD remains muted on the last trading day of the week. The pair remained pressured below 1.3830 as it failed to cross the level for the past few sessions.

At the time of writing, GBP/USD is trading at 1.3794, up 0.02% for the day.

The market seems to be fully discounting the Bank of England’s (BOE) rate hike expectations in November. Nick Bennenbroek, International Economist at Wells Fargo said after the initial November hike, there is an expectation for another 25bps increase in May 2022 and a further 25 bps in November 2022, which means ending the BOE’s policy rate cycle by the next year-end at 0.75%.

The Brexit-led optimism failed to uplift the sentiment surrounding the sterling, in the wake of the positive comments from UK Prime Minister Boris Johnson on the NI protocol.

The greenback managed to hold near 93.70 with minimum losses, tracing the higher US T-bonds yields at 1.68%. US President Joe Biden remained positive on the passage of the major infrastructure and social spending measures.

Mixed US data continues to weigh negatively on the US dollar. The Existing Home Sales jumped 6.29 million units in September with a growth of 7% on monthly basis. The Philadelphia Fed Manufacturing Index fell 23.8 in October as compared to 30.7 in September. The US Initial Jobless Claims came lower at 290K below the market expectations of 300K.

As for now, traders keep their focus on the UK Retail Sales and US Markit Manufacturing Purchasing Managers Index (PMI) data to gauge market sentiment.

GBP/USD technical levels

GBP/USD

Overview
Today last price	1.3796
Today Daily Change	0.0004
Today Daily Change %	0.03
Today daily open	1.3792

Trends
Daily SMA20	1.3641
Daily SMA50	1.3714
Daily SMA100	1.3805
Daily SMA200	1.3849

Levels
Previous Daily High	1.3833
Previous Daily Low	1.3776
Previous Weekly High	1.3773
Previous Weekly Low	1.3568
Previous Monthly High	1.3913
Previous Monthly Low	1.3412
Daily Fibonacci 38.2%	1.3798
Daily Fibonacci 61.8%	1.3811
Daily Pivot Point S1	1.3768
Daily Pivot Point S2	1.3744
Daily Pivot Point S3	1.3711
Daily Pivot Point R1	1.3825
Daily Pivot Point R2	1.3857
Daily Pivot Point R3	1.3881

Author

Rekha Chauhan

Independent Analyst

Rekha Chauhan has been working as a content writer and research analyst in the forex and equity market domain for over two years.

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