Gbpusd Rally Higher To Ytd High

 Gbpusd Rally Higher To Ytd High

Gbp/Usd Rally Higher Towards 1.2700, Ytd High In Sight

The GBP has the upper hand against the USD as it has already gained 0.21% for the day. Meanwhile, the US bond yields are not bullish enough to support the greenback.

For now, the GBP/USD is trading near the 1.2703 handle after taking a U-turn from the 1.2644 handle. This recovery in the GBP/USD is a sign that the greenback is in trouble after the CPI and the Fed comments.

Gbp/Usd Trades Above 100 Sma

Technical analysis shows that the GBP/USD has already crossed the 100 SMA on the daily chart and even the 1.2631-1.2634 region (high from 3rd May.) All of this allowed the GBP/USD to head higher towards the 1.2690 level.

Despite the positive sentiment, the GBP bulls appear to be shy of targeting the 1.2700 resistance level. If the GBP/USD manages to break this barrier, it will open the doors for the GBP to reach a YTD high against the USD.

Once the 1.2700 handle is in the palms of the GBP/USD bulls, the next price target will be 1.2803 and then the 1.2894 handle. In short, the GBP/USD will have sufficient leg room of almost 100 pips once the 1.2700 is out of the way.

The other scenario is sellers dragging the GBP/USD towards 1.2650, which could expose the support to 1.2630. Once these two levels are taken out, the next stop for the GBP/USD bears will be 1.2500.

Before the 1.2500 level, the GBP/USD bears will need to take out the 1.2539, where the 200 SMA (D1) is located.

Either way, the market sentiment and the technical analysis show that the GBP has the upper hand against the USD. While the US Federal Reserve is expected to cut rates in September, there's no such date from the Bank of England.

Another factor that goes in favor of the GBP/USD bulls is a broader weakness in the greenback. This has allowed a lot of major currencies to stage an upside against the USD, including the GBP.

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