GBP/USD is trading below 1.4050, as the US dollar remains broadly bid amid risk-off sentiment. Rising inflationary pressures and Brexit jitters over NI keep investors on the edge. Bailey's speech, US data are in focus.
From a technical perspective, the pair was seen hovering around the 23.6% Fibonacci level of the recent leg up from April monthly swing lows. Some follow-through selling might prompt some additional long-unwinding and accelerate the slide further towards a strong horizontal resistance breakpoint, now turned support near the key 1.4000 psychological mark. This is closely followed by the 38.2% Fibo. level, around the 1.3980-75 region, which if broken decisively will shift the near-term bias in favour of bearish traders.
On the flip side, the daily swing highs, around the 1.4075-80 region now seems to act as an immediate hurdle ahead of the 1.4100 mark. A sustained move beyond will negate any near-term negative bias and allow bulls to aim to reclaim the 1.4200 mark. The upward trajectory could further get extended back towards retesting YTD tops, around the 1.4235 zone touched on February 24.
