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GBP/USD a key pair to watch this week

FXStreet (Guatemala) - GBP/USD is trading at 1.5867, down -0.06% on the day, having posted a daily high at 1.5919 and low at 1.5864.

GBP/USD is offered through the 1.5900 level and has closed the bullish gap. The greenback has been pulling back to some extent from a heavily bid environment with extravagant gains of late and there remains a corrective atmosphere after a slightly disappointing Nonfarm payrolls from Friday’s closing. However, with the unemployment numbers in the US to the lowest since 2008, markets are confidant of rate hikes to come in 2015.

Sterling, on the other hand, trades in the shadows of a disinflationary environment in the UK. This week brings key information in this respect. First of all, we will see the UK labour market data on Wednesday and then later we will get the BoE’s quarterly inflation report. Analysts at TD Securities suggested that although markets may have pushed BoE hikes back too far already, they think that this QIR will come out as extremely dovish with substantial near-term CPI forecast downgrades, and we could see the first BoE hike pushed even further into the future.

GBP/USD noteworthy levels

With spot trading at 1.5867, we can see next resistance ahead at 1.5886 (Hourly 20 EMA), 1.5897 (Weekly Classic PP) and 1.5913 (Daily Classic R1). Support below can be found at 1.5852 (Daily Classic PP), 1.5800 and 1.5780.

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