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Thomson Reuters
Jun 12 - 12:12 PM
GBP/USD - COMMENT-ECB Offers Best Hope For Sterling Breakout
First appeared on eFXplus on Jun 12 - 10:20 AM

This week's ECB meeting presents the next good opportunity to produce a decisive breakout in USD/GBP, which currently remains mired in a narrowing range.
Cable once again found resistance above 1.3400, ahead of the falling 30-DMA at 1.3436.
The 30-DMA and 10-DMA, currently at 1.3363, mark the boundaries of cable's recent range, which is slightly above May 29's 2018 low at 1.3205.
The ECB could break sterling's stalemate on Thursday, particularly if it signals QE tapering.
Any broad-based dollar selling could lift the pound, though weak UK fundamentals should cap it near the 200-DMA and upper 30-d Bolli in the 1.3600/30 area.
Mixed data nL8N1TE1QA, showing a rise in employment and a dip in average earnings reinforced the range.
Rising employment and lower inflation presents the BoE in with a similar Phillips Curve dilemma as the U.S. This is helping keep odds for an August BoE hike below 50 percent and barely one 25bp hike priced in by year end.
That leaves cable looking for other drivers, such as the ECB meeting.

GBP Chart Click here

Source:
Thomson Reuters IFR Markets

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