Despite coming in higher on the GDP print GBP falls to the lows of the day against the USD.
The UK GDP has just come out slightly better than forecast but GBP has fallen to its lows of the day at 1.2630.
Things look more constructive for GBP against the Euro. EUR/GBP has traded as low as 8466 today and the bounceback has been muted.
Eurgbp has resistance at 8520 and 8565 with support at 8445 and then the all important 8400 level which is also the 200-day moving average.
Longer term, a daily close or two below the 8300 level would imply that a much larger GBP rally is on the cards.
Overall from a technical perspective, GBP’s price action against the USD and Eur looks constructive still. Today’s drop being perhaps a correction to a good run higher this week. Combined with the UK’s continued outperformance on every recent data release, there is the possibility that GBP bears may still have more pain to endure.
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