GBP/USD – Pound Looking to Test Key 1.30 Level

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Updated: Feb 13, 2020, 08:20 UTC

The British pound remains close to the 1.30 level and could challenge this key line before the end of the week. Investors are keeping a close eye on U.S. consumer inflation releases, which will be published at 13:30 GMT.

GBP/USD is showing limited movement in the Thursday session. The pair is currently trading at 1.2977, up 0.15% on the day.

Ahead – U.S. Consumer Inflation

With no major British events on the schedule, the spotlight will be on releases out of the U.S. We’ll get a look at key inflation numbers at 13:30 GMT, with the release of CPI and Core CPI. Consumer inflation and consumer spending have both been soft in recent months, although the U.S. economy remains in good shape. CPI dipped to 0.2% in December, down from 0.3%. Another weak gain of 0.2% is projected for January. Core CPI is expected to edge up from 0.1% to 0.2%.

Technical Analysis

We continue to see stubborn resistance at the key level of 1.300, with the 50-day EMA line following closely at 1.3004. Above, there are resistance lines at 1.3070 and 1.3170. On the downside, there is support at 1.2902. Lower, there is support at 1.2850. Below, The 200-day EMA is situated at 1.2844.

Pacific Currencies – Daily Summary

USD/CNY

USD/CNY has posted small gains. Currently, the pair is trading at 6.9799, up 0.13% on the day. Investors are waiting for the release of New Loans, which is expected to be released on Friday or Saturday. The indicator is expected to improve sharply to 3100 billion yuan in January.

AUD/USD

AUD/USD has inched higher on Thursday. Currently, the pair is trading at 0.6721, up 0.13% on the day. In economic news, MI Inflation Expectations fell sharply to 4.0% in January, down from 4.7% a month earlier.

NZD/USD

NZD/USD has steadied on Thursday after posting strong gains a day earlier. Currently, the pair is trading at 0.6450, up 0.07% on the day. There are no New Zealand events on the calendar. On Wednesday, the New Zealand central bank maintained the benchmark interest rate at 1.00%, and the bank’s rate statement was on the neutral side. However, the bank downplayed the downside risk posed by coronavirus to New Zealand’s economy, which gave a boost to the currency on Wednesday. NZD/USD is up close to 1 percent this week, and is on track for its highest weekly gain this year.

About the Author

Kenny Fisherauthor

Kenny is an experienced market analyst, with a focus on fundamental analysis. Kenny has over 15 years of experience across a broad range of markets and assets –forex, indices and commodities.