GBP/USD up for the day but limited by 1.3900
- Pound consolidates gains versus US dollar.
- Pair holds near key short-term technical level.
Cable continues to move sideways near daily highs and around the 1.3900 area. The pair rose earlier on the back of a modest decline of the US dollar. The US Dollar Index was unable to recover the 90.00 handle and it was trading at 89.89 below.
GBP/USD pealed today at 1.3905, the highest level since last Thursday. It failed to continue above and pulled back. Since then it has been moving in a range between 1.3905 and 1.3880. A consolidation on top of 1.3900/20 would improve significantly the technical outlook for the pound opening the doors to more gains.
On the flip side, below 1.3880 support levels might lie at 1.3860, 1.3840 (daily low) and 1.3815
Week ahead in US and UK
Analysts from Danske Bank, point out that during the current week there are no exciting data releases or scheduled events. “The focus will be on Brexit ahead of the important EU summit on 22-23 March. We still think it is likely that the two sides can reach an agreement on transition relatively fast but uncertainties remain about the future relationship, where there are still significant disagreements between the EU and the UK.” The budget report is due on Tuesday.
In the US, on CPI data will be released tomorrow and on Wednesday retail sales and PPI numbers. Next week will be the March FOMC. The decision will be announced March 21.