Key Points
- The GBP dropped to its lowest price level in 5 months against the Greenback.
- The Pound spiked after the release of UK PMI data before once again bowing to bearish pressure. Focus now turns to US PMI later today.
- The 1.23907 resistance level will be crucial in today’s trading session.
GBP/USD Daily Price Analysis – 23/04/2024
The Pound lost 0.17% against the dollar at the end of Monday’s trading session, dipping to the lowest in 5 months. After the release of the UK PMI reports in the early hours of Tuesday, the pair briefly spiked to recover Monday’s loss before bowing once again to bearish pressure and reducing the gains to a meager 0.06%.
The Fed’s higher for longer interest, sticky inflation, and resilient economic growth have all strengthened the Greenback. The CME FedWatch tool puts the chances for a rate cut in September at 64%, a month ahead of when the UK is expected to cut rates. According to the Swap Market, the chances of a rate cut in August stands at 95.9%.
The GBP spiked after the release of PMI data on Tuesday morning. The S&P Global/CIPS Services PMI rose from 53.1 to 54.9, showing signs of continued economic recovery from the recession. The focus will now shift to the US S&P Global PMI data later today.
From a technical perspective, the 50EMA and the StochRSI indicators have a bearish outlook on price, with the latter dipping into the oversold region.
GBP/USD Technical Analysis – 23/04/2024
Yesterday, the price dipped to its lowest point in five months, bottoming out at 1.22994. Today, the first real test awaits the price at the 1.23907 level. If the price is to make a push to the bullish side, it first has to pass through that resistance level. Already, the price has had trouble crossing that level since it dipped below it last Friday. Beyond that key level, the resistance level is at 1.25011.
If the price drops instead, the 5-month low of 1.22994 will serve as a support level. Breaking this support will open the lower 1.22493 support open for a further bearish slide.
Key Economic Data and News to Be Released Today
The S&P Global US Manufacturing, Composite, and Services PMI reports will take center stage today. Reactions to these reports could determine the trajectory of the trading day. However, investors will focus on GDP data on Thursday to get more insight into the strength of the US economy and potential Fed rate decisions.
GBP/USD Pivot Point Price Levels 23/04/2024
Based on the hourly chart, here are the key GBP/USD pivot point levels to watch as of 23/04/2024.
| S2 | S1 | Pivot Point | R1 | R2 |
| 1.22541 | 1.23019 | 1.23472 | 1.23950 | 1.24403 |
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