FXStreet (Edinburgh) - The sterling is now following its European peer on Monday, with the GBP/USD deflating from the area around 1.7050.
GBP/USD correcting from peaks
The pair is now leaving behind recent gains after spot reached multi-year highs beyond 1.7060 last week, backed by the solid numbers from the UK economy and increased market expectations for a rate hike sooner than anticipated. “ Although sterling closed two consecutive sessions above $1.70, including on a weekly basis, its foothold is precarious near-term. Pullbacks will likely be bought. The key issue is how shallow of a dip. A break of $1.6975 would signal a deeper pullback and the next objective would be closer to $1.6920, suggested analysts at BBH.
GBP/USD levels to watch
As of writing the pair is up 0.01% at 1.7016 with the initial hurdle at 1.7061 (high Jun.20) followed by 1.7064 (high Jun.19) and finally 1.7100 (psychological level). On the flip side, a breakdown of 1.7003 (low Jun.20) would open the door to 1.6985 (low Jun.19) and then 1.6920 (low Jun.18).