GBP/USD eases off session highs post-US data
After reaching its session high at 1.2280, the GBP/USD pair started to retrace its daily gains as the greenback gained strength following the macro data from the United States. As of writing, the pair is trading at 1.3856, still up 0.12% on the day.
Today's data from the U.S. showed that the personal income increased by 0.4% in April on a monthly basis, matching the expectations. On the other hand, Fed's favorite inflation gauge, the Personal Consumption Expenditure (PCE) price index, improved to +0.2% on a monthly basis and eased to 1.7% on a yearly basis. However, March data was revised up to 1.9% from 1.8%. The mixed macro data couldn't help the major equity indexes in the U.S. find a direction either, suggesting that the market sentiment is unclear.
- US: Personal income increased $58.4 billion (0.4%) in April
The US Dollar Index, which fell to its daily low at 97.20 just before the data release, recovered its daily losses and moved into the positive territory. As of writing, the index was trading at 97.37, up 0.04% on the day. Tomorrow's economic docket will feature consumer credit change and M4 money supply from the U.K. The NA session on Wednesday will be relatively quiet ahead of Friday's critical NFP report.
Technical levels to consider
Despite the pullback, the pair is floating above 1.2820 (Fibo 23.6% retracement of March - May rise) and is poised for further gains as long as this level holds. 1.2920 (20-DMA) could be targeted ahead of 1.3000 (psychological level/May 24 high) and 1.3050 (May 18 high). To the downside, a break below 1.2820 could open the door towards 1.2690 (Fibo 38.2%) and 1.2595 (100-DMA).
- GBP/USD rallies appear capped near 1.3060 – Commerzbank
- GBP/USD bearish near term – UOB