GBP/USD Price Forecast: Picks up above 1.3500 amid generalised US Dollar weakness
The British Pound (GBP) pares losses against a weaker US Dollar (USD) on Friday, as a run of soft US inflation figures and growing signs of labour market deterioration have cast doubt about the odds for an immediate Federal Reserve (Fed) rate hike.
The British Pound strengthened against a weakening US Dollar on Friday, following weak US inflation data and signs of a deteriorating labor market. The GBP/USD exchange rate has climbed to the 1.3520 region following a drop to 1.3474 on Thursday, inching closer to the 1.3550 resistance level. Analysts at ING note that these data releases are relatively minor and unlikely to cause a significant shift in the dollar's stable trading pattern, barring a major data surprise.
The pair traded at 1.3520 at the time of writing, held within its weekly trading range with a potential key resistance level at 1.3550. Momentum indicators suggest a slight bullish trend with the 4-hour Relative Strength Index (14) above 60, despite the Moving Average Convergence Divergence (MACD) indicator being flat near the zero line.
For the Pound to resume its bullish trend, it needs to surpass the July 15 and August 12 highs around 1.3550, aiming for a retest of the early May highs in the mid-1.3600s. Conversely, downside attempts are currently limited to Thursday's low of 1.3474, just above the previous week's trading bottom near 1.3400. The table below shows the percentage change of the US Dollar (USD) against major currencies today, with the US Dollar ranking strongest against the Swiss Franc.
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