GBP/USD Tests Resistance At 1.3050

Key Insights

• Today, traders will focus on the Fed Interest Rate Decision.
• Traders will also take a look at the U.S. Retail Sales data for February.
• A move above 1.3050 will push GBP/USD towards the next resistance at 1.3080.

British Pound Tries To Gain More Ground Against U.S. Dollar

GBP/USD continues its attempts to settle above the resistance at 1.3050, while the U.S. dollar is losing ground against a broad basket of currencies.

The U.S. Dollar Index settled below the 99 level and is trying to get to another test of the support at 98.70. A move below this level will push the U.S. Dollar Index towards the next support at 98.35, which will be bullish for GBP/USD.

Today, foreign exchange market traders will have a chance to take a look at the Retail Sales data from the U.S. Analysts expect that Retail Sales increased by 0.4% month-over-month in February after growing by 3.8% in January. On a year-over-year basis, Retail Sales are projected to grow by 15%.

The main event of the day for currency markets is the Fed Interest Rate Decision and the subsequent commentary. The Fed is expected to raise the rate from 0.25% to 0.5%, but markets will likely stay focused on Powell’s commentary, which will highlight Fed’s current views on inflation.

Technical Analysis

GBP/USD is testing the resistance level at 1.3050. In case this test is successful, GBP/USD will move towards the next resistance level, which is located near the recent highs at 1.3080.

A move above the resistance at 1.3080 will push GBP/USD towards the resistance at 1.3110. If GBP/USD manages to settle above this level, it will head towards the next resistance at 1.3140.

On the support side, the nearest support level for GBP/USD is located at 1.3030. In case GBP/USD declines below this level, it will head towards the next support at 1.3000. A successful test of this support level will push GBP/USD towards the support at 1.2970.

For a look at all of today’s economic events, check out our economic calendar.