#GBPUSD @ 1.19851 regains positive traction on Tuesday amid the emergence of fresh USD selling. (Pivot Orderbook analysis)

…
This is a premium post.
[s2If !current_user_can(access_s2member_level4)]Please register for PREMIUM VERSION HERE to read full post below containing analysis. In case of any error or you think you are not able to read the full post below, please email us at support#nehcap.com [lwa][/s2If] [s2If current_user_can(access_s2member_level4)]

• GBP/USD regains positive traction on Tuesday amid the emergence of fresh USD selling.
• Bets for less aggressive Fed rate hikes continue to weigh on the buck amid a positive risk tone.
• A bleak outlook for the UK economy acts as a headwind for the GBP and caps gains for the pair.

The pair currently trades last at 1.19851.

The previous day high was 1.2118 while the previous day low was 1.1941. The daily 38.2% Fib levels comes at 1.2009, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.205, expected to provide resistance.

The GBP/USD pair attracts fresh buying on Tuesday and reverses a major part of the previous day’s slide to a three-day low. The pair, however, retreats a few pips from the daily peak touched during the first half of the European session and is currently trading just above the 1.2000 psychological mark.

A combination of factors prompts fresh selling around the US Dollar, which, in turn, is seen extending some support to the GBP/USD pair. The global risk sentiment gets a minor lift after Chinese authorities hinted to loosen COVID-19 restrictions, despite a nationwide surge in cases. This is evident from signs of stability in the equity markets and undermines the safe-haven Greenback. Furthermore, expectations that the Fed will slow the pace of its policy tightening exert additional downward pressure on the buck.

In fact, the November Federal Open Committee Market (FOMC) meeting minutes released last week cemented market bets for a relatively smaller 50 bps rate hike in December. This leads to a fresh leg down in the US Treasury bond yields and continues to weigh on the USD. The British Pound, on the other hand, draws support from rising bets for further substantial Bank of England rate hikes. That said, a bleak outlook for the UK economy acts as a headwind for the Sterling and keeps a lid on any meaningful appreciating move for the GBP/USD pair, at least for now.

There isn’t any major market-moving macro data due for release from the UK on Tuesday, while the US economic docket features the Conference Board’s Consumer Confidence Index. Apart from this, speeches by BoE MPC Member Catherine Mann and Governor Andrew Bailey will be looked upon for some impetus. Traders will also take cues from the broader risk sentiment, which might influence the USD and produce short-term opportunities around the GBP/USD pair.

Technical Levels: Supports and Resistances

GBPUSD currently trading at 1.2023 at the time of writing. Pair opened at 1.1948 and is trading with a change of 0.63 % .

The pair is trading above its 20 Daily moving average @ 1.173, above its 50 Daily moving average @ 1.1428 , above its 100 Daily moving average @ 1.1645 and below its 200 Daily moving average @ 1.2176

The previous day high was 1.2118 while the previous day low was 1.1941. The daily 38.2% Fib levels comes at 1.2009, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.205, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 1.1887, 1.1825, 1.1709
• Pivot resistance is noted at 1.2064, 1.218, 1.2242

[/s2If]
Join Our Telegram Group