GBPUSD Consolidates Above 1.23, Short Term Positive Momentum Intact

GBPUSD reverse early losses and returned back to the unchanged level after earlier today tested the 50-day moving average. British pound boosted by news that the EU is willing to make concessions on fishing rules as the negotiations will start again next week.

The Bank of England Chief Economist Andy Haldane warned yesterday that the UK economy would probably shrink by more than 20% in the second half of 2020. Andy Haldane also downplayed the negative rate scenario saying the central bank is not close to to a decision on taking interest rates below zero.

The British pound also helped by the global risk-on sentiment on the reopening optimism. In the UK from June 1st, flea markets and showrooms will reopen while from June 15th, all non-essential retail outlets will be reopened. However, social distancing rules have to be followed, and necessary restrictions will be in place.

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GBPUSD Price Technical Levels to Watch

GBPUSD is 0.04% lower at 1.2330, keeping the positive momentum above the 1.23 mark. The technical outlook has improved for the short term as the pair yesterday breached above the 50-day moving average. The outlook for the long term remains bearish below the 100-day moving average. 

On the downside, first support stands at 1.2281 the daily low. In case GBPUSD breaks below the 1.2281 support level, the GBPUSD could retreat towards 1.2181 the low from yesterday’s trading session. If the GBPUSD pair continues lower, the next support zone would be met at 1.2074 the low from March 18. 

On the other hand, the immediate resistance for the pair stands at 1.2354 the daily top. The next obstacle would be met at 1.2432 the high from May 11 trading session. A successful break above 1.2432 is likely to open the way for a move higher to the next resistance at 1.2597 the 100-day moving average. 

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