GBP/USD back above 1.3200, but for how long?

• Volatile within range
• Upside appears capped amid lack of fresh catalysts
• US CB consumer confidence data eyed

The GBP/USD pair is seen fluctuating between gains and losses over the last hours, as the pound trades directionless across the board amid a lack of fresh fundamental drivers.

GBP/USD wavers near 20-DMA at 1.3202

The spot clocked fresh three-day tops at 1.3222 in early Asia, and from there entered a phase of upside consolidation, as the bulls lack momentum amid notable US dollar demand across its main competitors. The recovery in the greenback picked-up pace in the European session, as Treasury yields turned positive on the improved appetite for risk assets, sending the USD index through 94.50 levels, up +0.14% on the day.

Despite the lackluster trading, the sentiment around Cable remains underpinned by the increased expectations of a BOE rate hike this Thursday, while the US political jitters and tax reforms uncertainty could keep the DXY recovery limited.

Later today, the pair will get influenced by the USD dynamics and broader market sentiment ahead of the US Chicago PMI, employment cost index and CB consumer confidence data lined up for release later in the American session.

GBP/USD Technical View

Jim Langlands at FX Charts explains: “The momentum indicators are generally mixed/flat although the short term momentum indicators are possibly looking a little more positive, so we may see a sterner test of the NY high, above which the descending trend resistance at 1.3235 will sell sellers. A break would suggest a run to 1.3275 and possibly 1.3300 although possibly not today.  On the downside, minor support will be seen at 1.3180 and 1.3150 ahead of the session low of 1.3112.”