#GBPUSD @ 1.24316 is expected to display more weakness below 1.2420 as the focus shifts to BoE Bailey’s speech. (Pivot Orderbook analysis)

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• GBP/USD is expected to display more weakness below 1.2420 as the focus shifts to BoE Bailey’s speech.
• The USD Index is facing barricades above 103.30 as the upside is capped due to further delay in US debt-ceiling issues.
• UK’s inflation is seen declining due to a fall in the oil price.

The pair currently trades last at 1.24316.

The previous day high was 1.2472 while the previous day low was 1.2414. The daily 38.2% Fib levels comes at 1.2436, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.245, expected to provide resistance.

The GBP/USD pair looks vulnerable above the immediate support of 1.2420 in the early European session. The Cable is struggling in defending the nearest cushion as investors are awaiting the speech from Bank of England (BoE) Governor Andrew Bailey.

S&P500 futures are holding half of the gains added in Asia, portraying a mildly positive market mood. The US Dollar Index (DXY) is facing barricades above 103.30 as the upside is capped due to further delay in US debt-ceiling issues and the downside is being supported by hawkish commentary from Federal Reserve (Fed) policymakers.

The US Dollar Index (DXY) is expected to remain on the tenterhooks ahead of the preliminary S&P PMI figures (May). Manufacturing PMI is seen softening to 50.0 from the former release of 50.2. While Services PMI is expected to remain steady at 53.6. A second consecutive release of Manufacturing PMI above 50.0 would indicate that the manufacturing sector is coming out of the contraction phase.

On the Pound Sterling front, investors are awaiting the release of the United Kingdom’s Consumer Price Index (CPI) data. As per the preliminary report, the headline UK Consumer Price Index is seen at 8.3%, significantly lower than the prior release of 10.1% annually. Monthly headline CPI has shown a steady growth at 0.8%. Core CPI that excludes the impact of oil and food prices is expected to remain stable at 6.2%.

Going forward, the speech from BoE Andrew Bailey will remain in action. The speech from BoE’s Bailey is expected to provide the interest rate guidance for the monetary policy scheduled for June.

Technical Levels: Supports and Resistances

GBPUSD currently trading at 1.243 at the time of writing. Pair opened at 1.2437 and is trading with a change of -0.06 % .

The pair is trading below its 20 Daily moving average @ 1.2515, above its 50 Daily moving average @ 1.2416 , above its 100 Daily moving average @ 1.2274 and above its 200 Daily moving average @ 1.1971

The previous day high was 1.2472 while the previous day low was 1.2414. The daily 38.2% Fib levels comes at 1.2436, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.245, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 1.241, 1.2382, 1.2351
• Pivot resistance is noted at 1.2468, 1.25, 1.2527

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