The sterling kept the composure after the US data on Wednesday, with the GBP/USD gyrating around 1.6360/55.
Today’s correction lower seems to have found decent support around 1.6320 earlier in the European morning, rebounding to the current levels near the mid-1.63s. A narrower US trade deficit during October and a solid print from the ADP employment report were almost ignored by GBP traders, more focused on tomorrow's BoE and ECB meetings ahead of November’s Payrolls on Friday. “The 1.6400 ceiling may provide a cause for pause in the interim while initial support may materialize on dips towards 1.6300. At this juncture, our positive GBP-USD view remains a conspicuous counter-trend call, given that we retain a broad preference for the USD elsewhere in FX space”, suggested Emmanuel Ng, Analyst at OCBC Bank.
As of writing the pair is retreating 0.23% at 1.6349 and a breach of 1.6326 (low Dec.4) would clear the way to 1.6315 (low Nov.29) and then 1.6293 (MA10d). On the upside, the initial resistance lines up at 1.6397 (high Dec.4) followed by 1.6437 (high Dec.3) and finally 1.6443 (2013 high Dec.2).