GBP/USD bulls take a breather at fortnight top, retreats to 1.1350 with eyes on UK politics
GBP/USD pares recently gains around a two-week high, easing back to 1.1350 during early Tuesday in Asia after an upbeat start to the week as bulls seek confirmation of the latest optimism surrounding the UK economy.
That said, the Cable pair renewed the multi-day top the previous day after British Finance Minister’s, also called Chancellor, reversal of earlier policy announcement boosted the market’s hope that London will overcome the impending market collapse. “Under the new policy, most of Truss's 45 billion pounds of unfunded tax cuts will go and the two-year energy subsidy scheme for households and businesses - expected to cost well over 100 billion pounds - will now be curtailed in April,” stated Reuters.
GBP/USD Price Analysis: Tests the upside break of triangle near 1.1350
The GBP/USD pair is displaying back-and-forth moves in a narrow range of 1.1344-1.1370 in the Tokyo session. The asset has turned sideways following the footprints of the US dollar index (DXY), which is indicating volatility contraction. The risk-off market mood is gaining more traction as S&P500 futures have extended their gains. Also, the 10-year US Treasury yields have surrendered the crucial support of 4% despite firmer bets for hawkish Federal Reserve (Fed) policy.
On a four-hour scale, the pound bulls are testing the north-side break of the symmetrical triangle chart pattern. The downward-sloping trendline of the above-mentioned chart pattern is placed from September 13 high at 1.1738 while the upward-sloping trendline is plotted from September 26 low at 1.0339. An explosion of a neutral triangle results in wider ticks and heavy volume.
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