GBP/USD re-attempts 1.3950 ahead of EU ‘urgent’ Brexit meeting

• Stuck in a range ahead of a Big week.
• Today’s EU ‘urgent’ Brexit meeting in focus.

The GBP/USD is seen making another attempt to take-out the key resistances lined up near the 1.3950 barrier after the spot found fresh support near 10-DMA of 1.3911 amid stalled USD buying.

Despite, the two-year Treasury yields sitting at decade highs, the greenback pared gains and trades almost flat versus its main competitors, as the USD bulls take a breather ahead of the key FOMC rate decision due this week.

Meanwhile, on the GBP-side of the equation, a fresh round of profit-taking cannot be ruled out, especially after the EU convened an ‘urgent’ Brexit meeting ahead of the EU’s Brexit Summit scheduled to take place on March, 22^nd and 23^rd this week.

From a broader perspective, Cable awaits fresh impetus from the FOMC and BOE policy outcomes for the next direction, which could see the rates testing the 1.40 handle or 1.38 handle. In the meantime, all eyes remain on the Brexit headlines and UK inflation report for some near-term trading opportunities.

GBP/USD levels to watch

Haresh Menghani, Analyst at FXStreet, notes: “Technically, the pair’s bullish break through a short-term descending trend-line resistance lacked any follow-through traction and thus, it would be prudent to wait for a decisive move beyond the 1.40 handle before positioning for any further appreciating move. On a sustained move above the mentioned hurdle, the pair now seems to surpass 1.4030-35 supply zone and aim towards reclaiming the 1.4100 handle.” 

“On the flip side, any meaningful retracement below the 1.3900 handle is likely to find strong support near mid-1.3800s confluence region, comprising of the descending trend-line resistance break-point and 38.2% Fibonacci retracement level of 1.3039-1.4345 up-move,” Haresh adds.