GBP/USD slips to near 1.3380 on Tuesday as a firmer US Dollar caps the pair below the 1.3400 resistance zone. Traders are holding back ahead of the June FOMC minutes due Wednesday, while last week’s close above the weekly Ichimoku cloud keeps the broader tone upbeat.
The Pound edges lower to near 1.3380 against the US Dollar during Tuesday’s European session, yet Cable stays broadly upbeat. The pair edges down as the US Dollar gains slightly.
Dollar firms as traders wait on FOMC minutes
The US Dollar Index trades 0.1% higher near 100.90, tracking the Greenback against six major currencies. That modest bid is enough to nudge GBP/USD down, but the move stays shallow.
The US Dollar is expected to trade cautiously as investors wait for the Federal Open Market Committee minutes of the June policy meeting, which land on Wednesday. Traders will read them for fresh cues on the Federal Reserve’s monetary policy outlook.
The 1.3400 resistance zone caps the recovery
Cable has moved within a narrow-range sideways mode for the second consecutive day, following a 1% advance last week. That advance completed a reversal pattern on the weekly chart and closed above the weekly Ichimoku cloud top at 1.3335.
However, the daily picture is less encouraging. Momentum on the 14-day reading stays negative and turns lower, while long upper shadows on the last two daily candles flag headwinds at the 1.3400 zone. That level stacks the converged 200-, 100- and 55-day moving averages against the 50% retracement of the 1.3653/1.3140 range.
Because of that cluster of moving averages, FXStreet flags the 1.3400 zone as strong headwinds on the recovery’s approach. Even so, its forecast holds that stability above the 20-day EMA backs further upside.
Source: FXStreet
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