GBP/USD: Bulls Conquer 1.4200 Amid Oil Price Recovery
The offered tone around the GBP appears to weaken in the European morning, now allowing the recovery in GBP/USD to 1.42 handle, as markets continue to track the oil price action for fresh hints on the major.
GBP/USD slips below 5-DMA
The GBP/USD pair trades -0.06% lower at 1.4198, trying hard to beat offers lined up at 1.42 handle. The cable stalled its oil-led downward spiral near 1.4130 region and staged a modest recovery towards 1.42 handle, as the oil prices attempt a minor rebound from today’s collapse triggered by failed Doha negotiations on output freeze.
Further, with the recovery in the oil prices, the persisting risk-off moods appear to ease a bit, which also provided some respite to the GBP bulls. However, from a wider perspective, the pound is expected to remain under pressure as Brexit concerns mount combined with the ballooning budget deficits of the British economy.
Amid a lack of economic data from the UK docket in the day ahead, attention now shifts towards BOE Governor Mark Carney’s speech due tomorrow, while the UK jobs report due for release on Wednesday will also provide fresh incentives for the GBP traders.
GBP/USD Levels to consider
The pair has an immediate resistance at 1.4212/17 (20-DMA/ daily R2), above which 1.4241/50 (Apr 4 High/ psychological levels) would be tested. On the flip side, support is seen at 1.4165/66 (1h 200 & 50-SMA) below that at 1.4131/30 (Daily & Apr 15 Low).