GBP/USD Price Analysis: Gets set to refresh 10-month high around 1.2600

GBP/USD has shifted into an inventory adjustment phase after printing a fresh 10-month high at 1.2537.
UK’s monthly GDP remained stagnant while the street was anticipating an expansion of 0.1%.
US labor market conditions have loosened further as jobless claims remained higher than anticipated.

Sagar Dua FXStreet

The GBP/USD pair is demonstrating a lackluster performance after printing a fresh 10-month high at 1.2537 in the early Tokyo session. The upside move in the Cable remained mostly capped in comparison with other risk-perceived currencies. The reason could be the weak United Kingdom’s monthly Gross Domestic Product (GDP) (Feb) data released on Thursday.

UK’s monthly GDP remained stagnant while the street was anticipating an expansion of 0.1%. Annual Industrial Production contracted by 3.1% against the consensus of 3.7% contraction. The Manufacturing Production data was contracted by 2.4%. The scale of contraction in Manufacturing Production was lower than the estimate of 4.7%.

The US Dollar Index (DXY) is juggling above the immediate support of 101.00. The downside bias for the USD Index looks solid as the United States Producer Price Index (PPI) softened dramatically on Thursday. Also, labor market conditions have loosened further as jobless claims remained higher than anticipated.

GBP/USD is showing a sheer contraction in volatility after testing the horizontal resistance plotted from April 04 high at 1.2525 on an hourly scale. The Cable is displaying an inventory adjustment move between institutional investors and retail participants. The odds are in favor of an upside break of the inventory adjustment move as the overall trend has remained bullish.

The 20-period Exponential Moving Average (EMA) at 1.2513 is providing cushion to the Pound Sterling bulls.

Meanwhile, the Relative Strength Index (RSI) (14) is oscillating in the bullish range of 60.00-80.00, indicating that the upside momentum is still active.

For further upside, the Cable needs to surpass April 13 high at 1.2537, which will drive the asset towards a fresh 10-month high at 1.2597, which is 08 June 2022 high. A breach of the latter will expose the asset to May 27 high at 1.2667.

On the flip side, a break below the round-level support of 1.2400 will expose the asset to April 10 low at 1.2344 and March 30 low at 1.2294.

GBP/USD hourly chart

GBP/USD

Overview
Today last price	1.2524
Today Daily Change	0.0041
Today Daily Change %	0.33
Today daily open	1.2483

Trends
Daily SMA20	1.2338
Daily SMA50	1.216
Daily SMA100	1.2174
Daily SMA200	1.1909

Levels
Previous Daily High	1.2495
Previous Daily Low	1.2399
Previous Weekly High	1.2525
Previous Weekly Low	1.2275
Previous Monthly High	1.2424
Previous Monthly Low	1.1803
Daily Fibonacci 38.2%	1.2458
Daily Fibonacci 61.8%	1.2436
Daily Pivot Point S1	1.2422
Daily Pivot Point S2	1.2362
Daily Pivot Point S3	1.2326
Daily Pivot Point R1	1.2519
Daily Pivot Point R2	1.2556
Daily Pivot Point R3	1.2616

Author

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

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