The news article discusses the current state of the pound sterling, highlighting that it has found some relief from a weaker US dollar. The focus for the day is on the US GDP report and Federal Reserve (Fed) communication. The article also mentions that the pound’s vulnerability remains despite the slight pullback, as ultra-hawkish Neel Kashkari continues to emphasize the potential need for another interest rate hike by the Fed. From a Bank of England (BoE) perspective, there have been repriced expectations for rate cuts, leaving room for subsequent rate hikes in the UK.
In terms of technical analysis, the article states that while there may be a turnaround in the pound’s favor, it is expected to be short-lived due to favorable fundamentals for the US dollar. The article also mentions the key resistance and support levels for GBP/USD. Furthermore, it highlights that retail traders are currently net long on GBP/USD, according to IG Client Sentiment Data.
Overall, the article emphasizes the impact of US factors, such as the GDP report and Fed communication, on the pound sterling’s performance. It also highlights the contrasting monetary policy stances of the Fed and BoE, as well as the technical analysis of GBP/USD.