GBP/USD sidelined around 1.6750

FXStreet (Edinburgh) - The sterling is posting marginal losses vs. the US dollar on Thursday, taking the GBP/USD to the area of 1.6755/50.

GBP/USD lower on risk aversion, BoE

An unexpected dovish tone from yesterday’s Quarterly Inflation Report by the BoE plus a generalized sentiment favouring the greenback as of late has plotted against the recent upside bias in the GBP, dragging spot to the mid-1.6700s so far. According to Brian Martin, Senior European Strategist at ANZ, “we have argued recently that sterling's appreciation against the USD may be close to reaching maturity and that over the long run it has difficulty sustaining moves above the 1.70 area. This is not to say that the pound cannot test that level and move higher for short periods of time. But it is our view that better value is to be found in buying sterling against the euro (in the short term), yen and Commonwealth currencies (AUD, NZD and CAD)”.

GBP/USD relevant levels

At the moment the pair is losing 0.07% at 1.6753 with the next support at 1.6727 (23.6% of 1.5854-1.6997) ahead of 1.6721 (low Apr.16) and then 1.6700 (psychological level). On the flip side, a break above 1.6777 (high May 15) would open the door to 1.6805 (30-d MA) and finally 1.6840 (21-d MA).