#GBPUSD @ 1.20276 is demonstrating a sideways performance ahead of Fed Powell’s testimony. (Pivot Orderbook analysis)

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• GBP/USD is demonstrating a sideways performance ahead of Fed Powell’s testimony.
• The street is having mixed responses to Fed Powell’s testimony for interest rate guidance.
• UK’s Industrial and Manufacturing Production data might contract due to higher rates by the Bank of England (BoE).

The pair currently trades last at 1.20276.

The previous day high was 1.2049 while the previous day low was 1.1993. The daily 38.2% Fib levels comes at 1.2014, expected to provide support. Similarly, the daily 61.8% fib level is at 1.2028, expected to provide resistance.

The GBP/USD pair is displaying a lackluster performance in an extremely narrow range around 1.2020 in the Asian session. The Cable has been gyrating in a range of 1.2000-1.2050 from Monday as investors look more interested in going gung-ho for building positions after Federal Reserve (Fed) chair Jerome Powell’s testimony.

S&P500 futures have added some gains after a directionless Monday, portraying a minor optimism among the market participants. The US Dollar Index (DXY) is displaying a subdued performance as investors are awaiting Fed Powell’s testimony for further impetus. The return provided on 10-year US Treasury bonds has dropped marginally to 3.97%.

The street has a mixed response to Fed Powell’s testimony. One school of thought is of the view that Fed Powell won’t endorse more rates as January’s upbeat consumer spending might not continue ahead. Higher interest rates by the Fed have critically made the United States economy vulnerable. However, the other school of thought believes that the Fed will deliver a hawkish stance as the battle against persistent inflation is well complicated yet.

Apart from that, labor market data will be the key event this week. Wednesday’s US Automatic Data Processing (ADP) Employment data is seen at 195K, higher than the prior release of 105K. Strong demand for labor could propel the fears of more rates from the Fed. And, could spurt fears of a recession in the US economy.

On the Pound Sterling front, Friday’s data will be keenly focused. United Kingdom’s monthly Industrial Production (Jan) is expected to contract by 0.2% against an expansion of 0.3% reported in December. Monthly Manufacturing Production is expected to contract by 0.2% ahead.

Technical Levels: Supports and Resistances

GBPUSD currently trading at 1.2024 at the time of writing. Pair opened at 1.2019 and is trading with a change of 0.04 % .

The pair is trading below its 20 Daily moving average @ 1.2047, below its 50 Daily moving average @ 1.214 , above its 100 Daily moving average @ 1.1992 and above its 200 Daily moving average @ 1.1913

The previous day high was 1.2049 while the previous day low was 1.1993. The daily 38.2% Fib levels comes at 1.2014, expected to provide support. Similarly, the daily 61.8% fib level is at 1.2028, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 1.1992, 1.1964, 1.1936
• Pivot resistance is noted at 1.2047, 1.2076, 1.2103

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