GBP/USD: still a sell on rallies below 1.2200?

Currently, GBP/USD is trading at 1.2157, down -0.03% on the day, having posted a daily high at 1.2190 and low at 1.2107.

GBP/USD is pretty much flat on the shift after an initial bid from 1.2112 overnight that met the aforementioned high before retreating once again while markets continue to weigh up the political risks ahead in 2017. We have Trump's inauguration on the 20th Jan and the French elections in which the first round takes place April 23rd.

Sterling is going to come under the limelight and will likely get a boost should the EU look fragile on a Le Pen victory while PM May has opted for a harder style Brexit, the market forces are weighing on the pound currently and Article 50 is set to be triggered by the end of March. A resurgence of US positive outlooks could also hit sterling hard as investors search for yield and a safe haven in the greenback.

GBP/USD remains a ‘sell on rallies’ – Danske Bank

GBP/USD levels

With spot trading at 1.2158, we can see next resistance ahead at 1.2161 (Hourly 20 EMA), 1.2161 (YTD Low), 1.2161 (Daily Open), 1.2161 (Monthly Low) and 1.2161 (Weekly Low). 1.2200 is a key resistance and could remains a sell on rallies around the number ahead of 1.2300 where the market nuetralises the current bearish theme in the near term. Support below can be found at 1.2124 (Yesterday's Low), 1.2122 (Annual Low), 1.2122 (3 Year Low), 1.2122 (5 Year Low) and 1.2107 (Daily Low).

GBP/USD: weakness looking stretched? - Scotiabank