GBP/USD: upside favoured above 4hr 20 SMA?

Currently, GBP/USD is trading at 1.3561, down -0.05% on the day, having posted a daily high at 1.3587 and low at 1.3523. GBP/USD ended the NY session at 1.3560 and down  -0.04% within a range of 1.3536-1.3580, (just below 1.3583/85, the Fri and Asian high). 

Despite a stronger greenback, with the DXY up 0.4%, cable got a lift in the fixing today and the risk in the cabinet reshuffle was abated. There was a lack of drivers but there has been some Fed chat crossing the wires with Fed's Williams who says price-level targeting has benefits while painting a benign picture of Fed rate hikes, albeit highlighting the strength in the U.S. economy. Bostic said that the Fed should be cautious if yield curve continues to flatten while arguing that three rate hikes in 2018 may be too much.

The week ahead?

Looking ahead in the week, US retail sales and CPI are key while in the UK, trade will be in focus while ears kept to the ground for further Brexit noise with sentiment for a rate hike in 2018 from the BoE underpinning upside in the sterling. Meanwhile, cable remains within Jan 3 daily bar (1.3614-1.3495).

GBP/USD levels

"In the meantime, the pair presents a neutral short-term stance, trading now above a horizontal 4-hr 20 SMA, and with technical indicators hovering around their mid-lines, with limited bearish strength," noted Valeria Bednarik, chief analyst at FXStreet who added that the pair has bottomed in the 1.3520 region also last week, making of the area the immediate support ahead of a stronger one at 1.3495, last week's low.