GBP/USD Weekly Forecast: Bulls to face an uphill battle, with geopolitics in play.

GBP/USD flirts with monthly top amid hotter UK inflation, dovish Fed minutes.GBP/USD is heading into a fresh week on the front foot, having booked three straight weekly gains. The high-beta British pound remained resilient to the Russia-Ukraine crisis that dominated all through the week, as hotter UK inflation ramped up aggressive rate hike expectations from the Bank of England (BOE). Cable traders look forward to the Preliminary Business PMIs from both sides of the Atlantic, BOE’s Monetary Policy Report (MPR) and the Fed’s preferred inflation gauge for fresh trading directives.

GBP/USD in the hindsight: Hotter UK inflation eclipses geopolitical risks

The pound has once again defied bearish odds, coming out a clear winner for the third week in row when compared to the US dollar. The currency pair enjoyed bargain-buying and built upon the previous week’s gains. Bulls gave into the bearish pressure at the start of the new week on Valentine’s Day, as the risk-off trade extended from late Friday after the US reported of a likely Russian invasion beginning this week. No love on Valentine’s Monday as the calendar remained data-dry.

GBP/USD: Technical Analysis..Interim resistance for GBP/USD seems to have formed at 1.3650 following this week’s action. In case the pair clears that hurdle by making a daily close above, it is likely to face stiff resistance at 1.3700 (200-day SMA, psychological level, static level) ahead of 1.3750 (static level, February 23 high).

On the downside, 1.3600 (psychological level, former resistance) aligns as the first support. If the pair falls below that level and starts using it as resistance, next bearish targets could be seen at 1.3500 (100-day SMA, 50-day SMA, Fibonacci 38.2% retracement of the latest uptrend) and 1.3450 (Fibonacci 50% retracement.).GBP/USD building on this week’s gains with the one-week average sitting at 1.3592. The one-month outlook, however, remains overwhelmingly bearish.

GBP/USD struggles to gain traction, stays near 1.3600.GBP/USD is fluctuating in a relatively tight range around 1.3600 on Friday as investors asses the latest developments surrounding the Russia-Ukraine conflict. The upbeat data from the UK seems to have failed to provide a boost to the British pound. 

Gold closes in on $1,900 amid souring market mood.Gold reversed its direction and rose toward $1,900 in the second half of the day with risk flows cooling off on reports claiming additional Russian troops were moving to the Ukrainian border. The 10-year US T-bond yield is down 1.5%, helping XAU/USD gain traction.

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