The pair holds steady around 1.2640 ahead of PCE data and other economic reports. Short-term resistance at 1.27093 remains intact.
Key Points
- The GBP/USD lost 0.19% of its value yesterday, breaking its 6-day bullish streak.
- Key economic reports, including the US PCE, initial Jobless Claims, and Chicago PMI, may impact the pair’s price.
- In the short term, investors will pay close attention to 1.26721 and 1.27093 resistance levels.
GBP/USD Daily Price Analysis – 29/02/2024
The GBP/USD broke its 6-day bullish streak yesterday, losing 0.19% to close at $1.26615. At the time of writing, the price has only risen by 0.06%, currently trading at $1.26687 as we await US PCE data.
Recent inflation reports have caused economists and analysts to delay the timing of rate cuts so far, and as a result, the greenback is strengthening versus most currencies. Yet, the President of the New York Fed, Jon Williams, said in his speech yesterday that interest rate cuts are still possible this year. We’ll be looking at the PCE report today for more guidance on the inflation cut saga from the U.S.
Across the Atlantic, the BoE has also maintained a hawkish stance over interest rates. On Tuesday, Dave Ramsden, the BoE Deputy Governor, said he isn’t considering rate cuts until inflation eases.
On the technical front, the RSI hovers around the midpoint, and the 50-EMA is flat. These are signs of a ranging market. Sure enough, the price has struggled to get past the $1.25184 low and the $1.27724 high since the 6th of Feb.
GBP/USD Technical Analysis – 29/02/2024
Tracing our Fibonacci retracement tool from the $1.25354 low to the minor swing high of $1.27096, we see some crucial levels that have developed on the chart. The first among them is the $1.26721 resistance level, which coincides with the 0.786 retracement level on the Fibo. This level has proven to be a resilient ceiling for the price on the hourly chart, and it’ll be interesting to see how the price reacts around it in the near future.
A break above this strong resistance level could see the price first attempt to clear out the $1.26994 resistance level just farther away. And if this resistance cracks too, the $1.27093 high is the next target for the bulls.
The bears will hope the $1.26721 level continues to hold the price. If the price falls to the $1.26428 support level and breaks below it, the following support levels are $1.26223, $1.26018, and $1.25764.
Key Economic Data and News to be Released Today
The January data from the United States core Personal Consumption Expenditure Price Index (PCE) will be released today at 8:30 GMT-5. The forecast from analysts is 0.4%. If it comes out better than this, the Greenback stands to benefit, potentially causing the GBPUSD to dip.
We’ll also get the release of the Initial Jobless Claims and the Chicago PMI data from the North American country today.
GBP/USD Key Fibonacci Price Levels 29/2/2024
Based on the 1hr chart, the key standard pivot point levels for the GBPUSD are these:
| Support | Resistance |
| 1.26428 | 1.27093 |
| 1.26223 | |
| 1.26018 | |
| 1.25764 |
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