Buying the Retreat in GBP/USD After the Jump in US Inflation, As the 20 SMA Holds

The 20 SMA is holding for GBP/USD, so we decided to go long on this pair

Written by: Skerdian Meta • Wednesday, May 12, 2021 • 1 min read

• Last updated: Wednesday, May 12, 2021

GBP/USD is already starting to bounce higher

[[GBP/USD-sponsored]]

GBP/USD surged higher on Monday, breaking the big round level at 1.40 and increasing above 1.41, as the USD turned bearish once again. yesterday this pair traded around 1.4150, while today the price retreated down below 1.41 after the jump in US CPI inflation during April.

The UK GDP report which was released this morning showed a decline in Q1, although that was expected. The 20 SMA (gray) held for the GBP/USD on the H4 chart, so the bullish trend is expected to resume again soon. That’s the reason for going long in this pair a while ago. Below is the UK GDP report for Q1, and the other data for March.

Q1 UK GDP Report

UK Q1 GDP QoQ -1.5% vs. -1.6% expected
Q4 of 2020 GDP was +1.3%, so no recession
YoY GDP in March came at -6.1% vs. -6.1% expected
February GDP YoY was -7.3%
March GDP MoM +2.1% vs. 1.5 % expected
February GDD MoM was 0.4%

GBP/USD Live Chart

GBP/USD

The GBP held well, since the March month results were encouraging despite a difficult quarter. April should be better when that data comes given the reopening of the economy and services above all. So, now we are long on this pair.

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ABOUT THE AUTHOR See More

Skerdian Meta

Lead Analyst

Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.