GBP/USD rises toward 1.2800 amid USD weakness

GBP/USD is trading at fresh weekly highs, slightly below the 1.2800 handle. The pair has been moving all day with a bullish bias and accumulates a gain of 70 pips so far today. The slide of EUR/GBP limited the upside in cable but the weak US dollar strengthened.

Earlier today, the Bank of England presented the Financial Stability Report, showing no surprises. Carney took note of risks from the Brexit negotiations. The presentation had no impact on the pound. Mario Draghi pushed later EUR/GBP to the upside, after he mentioned that the current weakness in inflation is seen as transitory. 

GBP/USD rose sharply on the back of a decline of the greenback. The USD dollar started to decline during the Asian session and extended losses later. Not even US data helped the greenback. The US dollar index is headed toward the lowest close since October.

 Consumer Confidence Rises Modestly in June

Janet Yellen did not speak about monetary policy so far today in London, while Patrick Harker, in line with Draghi, signaled that the current subdued inflation is temporary. 

Fed’s Harker: Weakness in inflation seen as temporary

Technical levels 

To the upside, the immediate resistance is the 1.2800 zone (psychological) followed 1.2815/20 (Jun 14 high) and then 1.2870 (Jun 6 low). On the downside, support could be located at 1.2775 (intraday low), 1.2755/60 (Jun 26 high) and 1.2705 (Jun 26 low). 

GBP/USD: a belt of strong resistance 1.2800/50 - Scotiabank