GBP/USD moves little, stuck around 1.2725-30 region post-UK macro data
• UK monthly GDP arrives at 0.1% m/m in October, matching expectations.
• UK manufacturing production drops 0.8% m/m in October, a big miss.
• Focus remains tomorrow’s crucial parliamentary vote on the Brexit deal.
The GBP/USD pair held on to a mildly weaker tone around the 1.2720-30 region and had a rather muted reaction to the latest UK economic releases.
The British Pound got a minor boost earlier today after the official ECJ ruling on Article 50 was announced, confirming that UK can unilaterally revoke Brexit notification of its intention to withdraw from the EU.
The pair spiked to an intraday high level of 1.2760 but failed to capitalize and remained capped following the UK government's response to the official ECJ ruling, saying that it has no plan to revoke Article 50.
Today's mixed UK macro data – mostly in-line monthly GDP print and disappointing manufacturing production data, failed to impress the bulls and provide any meaningful impetus to the major.
Investors seemed reluctant to place any aggressive bets and preferred to wait on the sidelines ahead of tomorrow's meaningful vote on the UK PM May’s negotiated deal.
Meanwhile, a subdued US Dollar demand, amid growing prospects for a possible Fed rate hike pause in 2019, did little to influence and further collaborated to the pair's range-bound price action.
Technical levels to watch
The 1.2760-70 region might continue to act as an immediate strong hurdle and is closely followed by the 1.2800 handle, above which a bout of short-covering could lift the pair further towards 1.2835-40 supply zone.
On the flip side, the 1.2700 handle now seems to have emerged as an immediate strong support, which if broken might turn the pair vulnerable to head back towards challenging yearly lows, around the 1.2660 region.