TechnoMeter

The latter-portion of last week saw a strong bounce develop in GBP/USD, and this came after the pair tested below a key psychological level for the first time since last September. As we wrote earlier during the week, the down-trend in the British Pound was very much in-focus as we approached a read of inflation out of the UK for the month of June. Markets were looking for inflation to perk-up to 2.6% after two consecutive months at 2.4%, but the actual print gave us a third straight month at 2.4% to further muddy the water for the Bank of England.



Inflation strength is no longer as prominent, and in the wake of last week’s inflation report, prices dipped below the 1.3000 level for the first time since last year. But – as we wrote shortly after, GBP/USD was still very oversold. We looked for two areas of potential resistance may that could’ve opened the door for bearish strategies. But – no resistance showed at either, and prices are now finding a bit of support on the zone that we were looking at that runs from 1.3083-1.3100.

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