GBP/USD: Pound Eases on Weak Data, Firmer Dollar

Technical analysis of Forex market

Cable holds in red on Tuesday, as dollar rose on month-end demand, while weaker than expected UK mortgage approvals data added to negative near-term tone.

Traders also worry that soaring inflation may significantly hurt consumer demand that would further pressure pound.

Daily momentum indicators turn south and stochastic emerges from overbought territory, generating initial negative signal which would be boosted by close below 10DMA (1.2544), while extension below Fibo 38.2% of 1.2155/1.2666 recovery leg (1.2471) would increase risk of deeper drop and possible end of correction.

Res: 1.2666; 1.2700; 1.2726; 1.2772.
Sup: 1.2544; 1.2500; 1.2471; 1.2446.