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GBPUSD on Bid As US GDP Data Meets Consensus Targets

GBPUSD
GBPUSD

The US GDP (advance) came in at 2.1%, allowing the GBPUSD to extend gains made following the hawkish vote pattern of the BoE’s MPC. The US Dollar is trading steady against other pairs as the outcome met market expectations of 2.1%, and also equalled the revised previous figure. 

As a result, the USD did not make any appreciable moves, except on the GBPUSD where the Pound had a bullish response to the 0-2-7 vote (0 abstain-2 for rate cut-7 for rate hold) which was more hawkish than the market expectations of 0-3-6 (0 abstain-3 for rate cut- 6 for rate hold). 

The GBPUSD has extended its gains on the day. It now trades at 1.30915 as at the time of writing. 

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Technical Outlook for GBPUSD

There seems to be potential for further upside as the price pop today has lifted the Pound off the lower border of the symmetrical triangle on the daily chart. The uptick in price is expected to encounter initial resistance at the triangle’s upper edge, which is also where there is a horizontal resistance formed by previous highs of 3 April, 2 May and 10 December 2019 at 1.31754. 

A break of this price level by two successive candle penetrations to the upside confirms the breakout, which opens the door towards the 1.33193 resistance. Failure to break the initial resistance could allow price action to make another return to the downside as the price continues its journey within the triangle. The triangle’s lower border intersects the horizontal support level at 1.29932, which makes this price area the next potential target for a pullback. Further support lies at 1.27851 and requires a confirmed break of 1.29932 to come into the picture.