Seen at the end of the New York trading session yesterday (Wednesday), the US dollar traded lower against other major currencies slipping compared to investors ’expectations to see the US dollar return to show further strengthening heading into the weekend.
A speech by Federal Reserve (Fed) chairman Jerome Powell before Congress at yesterday’s New York session was the focus in which he noted that the central bank is deeply committed to lowering inflation again and will continue to raise interest rates until the end of the year.
At the end of the speech, Powell added that they will continue to maintain interest rate hikes even though they still do not yet have any hike decisions set by the Fed.
Meanwhile, the focus of yesterday’s European session was on the release of annual United Kingdom (UK) inflation data which rose to 9.1% for May 2022, becoming the highest inflation reading ever recorded in 40 years.
The rise has given room for the Pound to make gains against the US dollar which was seen moving flat during this week’s trading session.
Take a look at the price chart of the GBP/USD pair, after the release of UK inflation data in the European session yesterday saw the price has managed to make a rise of around 150 pips from below the 1.22000 zone to the resistance level of 1.23000 again.
But the rise failed to continue before prices began to decline back in yesterday’s New York session and ended session -end trading with a slower movement.
If the upside is still successful in today's trading, the upside is seen to test the 1.23000 resistance again and if the price manages to break the resistance, the higher upside is seen to re -test the 1.24000 resistance zone which was the focus last week.
For the continued rise, the resistance zone at 1.2500 will be the next target to be tested for the price to record the latest 2 -week high.
However, if the price returns to decline, the price support zone at 1.22000 will be tested again like the decline that occurred yesterday and also at the beginning of last week.
If the decline continues to break the 1.2200 zone, the price will target a lower decline towards around 1.21000 or may reach back to the 1.2000 support zone.
