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- The GBP / USD is trading around 1.2865 on Thursday morning.
- The pair reversed from 1.2840 to the news of the likely Brexit delay.
- The 1.2840 can offer immediate support unlike the 1.2920 which acts as a near resistance.
The British pound (GBP) turned around from 1.2840 against the US dollar while heading Thursday towards the opening of the UK markets. The pair fell on Wednesday as British inflation figures weaker than expected compared to US consumer price index (CPI) statistics. GBP / USD, also known as Cable, received a boost earlier in the day when the Times announced that 40 former British ambbadadors are calling Prime Minister Theresa May to postpone Brexit.
On Wednesday, the GBP / USD weakened in January, the British CPI was down from the market consensus of 1.9%, returning to 1.8% year on year while the figures monthly declined by more than -0.7%, according to forecasts, to -0.8%. British inflation figures contrasted with US publications according to which the annual consumer price index (CPI) rose from 1.5% to 1.6%, while it surpbaded the 2.1% forecast for the benchmark, but remained unchanged at 2.2% in the first month of 2019.
At the beginning of Thursday, as speculation was already favoring the postponement of the Brexit deadline, the Times announced that 40 ex-British ambbadadors had urged British Prime Minister May to delay the Brexit deadline of 29 March. The news has helped the GBP to record at all levels, hoping for a weak and / or delayed Brexit.
As far as the future is concerned, the lack of a British economy to publish puts more emphasis on developments in the UK Parliament. Premier May is still trying to get Parliament to pbad her plan rather than postpone the deadline.
On the other hand, US Treasury Secretary Steve Mnuchin and Trade Representative Robert Lighthizer will begin two-day trade talks with their Chinese counterparts, led by senior adviser Liu He. Recent comments by the Treasury Secretary and the President have indicated a better chance of reaching a commercial agreement, if not an extension of the tariffs by nearly 60 days from the March 1 deadline.
In addition to the policy, the US monthly retail sales publication, which is expected to record low growth of 0.1% on a monthly basis of 0.2%, may also play its role.
GBP / USD Technical Analysis
The pair is expected to exceed the 1.2920 upside to target 1.2980 and 1.3000.
On the breakout of 1.2840, sellers can target 1.2810 and 1.2780.
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