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GBP/USD: Struggle with 1.2845 extends into Asia, despite risk-on

GBP/USD: Struggle with 1.2845 extends into Asia, despite risk-on

The GBP/USD pair extends its overnight side-trend into Asia and remains slightly offered below the mid-point of 1.28 handle, as the US bulls appear to find some respite after yesterday’s sell-off in the greenback across the board.

Cable remains confined within a 10-pips slim range, with the downside cushioned by persisting risk-on trades, after the Asian indices track the rally in their Wall Street counterpart, with full markets returning.

Over the last hours, the US dollar is seen recovering some ground against most of its major peers, in response to the latest Trump headlines, citing that the US President Trump’s administration plans to tax repatriation of corporative foreign earnings at 10%. The USD index moved-off multi-month troughs of 99.57 and now trades muted around 99.68.

Looking ahead, amid a data-empty UK and US dockets, all eyes remain on the Trump administration’s announcement of the tax reform plans later on Wednesday, which will have a significant impact on the pair.

GBP/USD Levels to consider

A break above 1.2842/ 51 (daily top/ Apr 20 high) could lift the pair above 1.2871 (Apr 24 high), beyond which a test of 1.2912 (flash rally high) is imminent. Conversely, a break below 1.2819 (5-DMA), leading to a subsequent break below 1.2763/58 (10-DMA/ Apr 21 low) is likely to drag the pair towards testing its next support near 1.2722/00 (classic S3/ zero figure).