FX.co ★ Blackpink | GBP/USD

The GBP/USD pair is struggling to build on Friday's bounce off the area near the month's swing low and trades slightly higher above the 1.3500 round figure mark heading into the opening of a new trading week. Market participants appear to lack appetite for bold directional moves ahead of key central bank events. The US Fed and the Bank of England are set to reveal their respective monetary policy decisions later this week. US inflation numbers released last week confirmed expectations of a 25 bps interest rate hike by the US central bank. Coupled with rising geopolitical tensions in the Middle East, this is viewed as supporting the USD and putting pressure on the GBP/USD pair. The latest news is that the Yemen-based Houthi fighters, who enjoy backing from Iran, claimed that they targeted a military installation located in southern Saudi Arabia using drones and missiles. Also, an Iranian cargo ship was hit on Sunday in the Strait of Hormuz. In addition, the scheduled meeting on the Strait of Hormuz between Gulf nations and Iran was cancelled. This adds another factor behind the safe-haven Greenback. However, the British Pound (GBP) gained strength after yesterday's positive DP data, which revealed economic growth in July above market expectations. However, the lack of new economic reports until next Tuesday, when the UK Employment Data will be released, and then next Wednesday when the UK Consumer Price Index will come out, leaves traders hoping for a short-term push. Expectations that the BoE will not alter interest rates at 3.75% restrain GBP bulls from new bets. The GBP/USD currency pair is consolidating near two key levels on the technical charts: the 200-period SMA at 1.3522 and the 38.2% Fibonacci retracement at 1.3516. This technical situation implies a bearish bias for the immediate future and suggests that all rallies remain capped until the bulls breach this resistance cluster." A continued move above these levels will pave the way for a push toward the 23.6% Fibonacci retracement level at 1.3575. If this level breaks, the next resistance is the cycle base at 1.3671. The first level of support on the lower end is the 50.0% Fibonacci retracement level at 1.3468. If selling interest continues, more support may appear at the 61.8% Fibonacci retracement level at 1.3420 and the 78.6% Fibonacci retracement level at 1.3352.