GBPUSD at 1.27869 has encountered obstacles close to 1.2800 due to an uncertain market sentiment.

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• GBP/USD has faced barricades around 1.2800 amid an indecisive market mood.

The pair currently trades last at 1.27869.

The previous day high was 1.2837 while the previous day low was 1.277. The daily 38.2% Fib levels comes at 1.2796, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.2812, expected to provide resistance.

The GBP/USD pair has sensed selling pressure near the round-level resistance of 1.2800 in the London session. The Cable is facing the heat as the market mood has turned indecisive due to the extended weekend in the United States.

S&P500 futures have generated significant losses as fears of a recession in the US economy have not faded despite the Federal Reserve (Fed) skipped the policy-tightening spell. The street is worried as the Fed has cleared that no rate cuts are appropriate this year s labor market conditions have not eased as expected.

Meanwhile, economists at HSBC cited that investors should prepare for some consolidation in US equities as valuations have risen, and the potential of further Fed tightening may cut into future earnings estimates and valuations in the short term. However, we feel the Fed is closer to the end of its monetary policy tightening cycle, and this should bode well for US equities.

The US Dollar Index (DXY) has found intermediate support around 102.40 after a sell-off move. Going forward, the testimony from Fed chair Jerome Powell will be keenly watched.

On the Pound Sterling front, investors are awaiting the release of the United Kingdom inflation data. Scrutiny of the UK inflation expectations shows that inflationary pressures would soften further but will be insufficient to force the Bank of England (BoE) to pause the rate-hiking spree. More interest rate hikes are expected from the BoE as UK’s Employment conditions are extremely tight and food inflation is not showing signs of peaking yet.

Technical Levels: Supports and Resistances

GBPUSD currently trading at 1.2784 at the time of writing. Pair opened at 1.2792 and is trading with a change of -0.06 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 1.2513, 50 SMA 1.25, 100 SMA @ 1.2328 and 200 SMA @ 1.2051.

The previous day high was 1.2837 while the previous day low was 1.277. The daily 38.2% Fib levels comes at 1.2796, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.2812, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 1.2762, 1.2733, 1.2696
• Pivot resistance is noted at 1.2829, 1.2866, 1.2896

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