Despite a rally off one-week lows Sterling struggled to gain above the 1.3000 resistance mark after the British government unveiled a GBP 30 billion stimulus plan and the Bank of England cut interest rates by 0.5% to boost the struggling economy. The British Pound initially jumped to 1.29763 highs before slumping to 1.28206 overnight low, rallying to 1.2840 at the New York close. Brexit and the recovering US Dollar remain headwinds.
GBP/USD has immediate support at 1.2820 followed by 1.2780. A clean break of 1.2780 would see 2020 lows of 1.2725. Immediate resistance can be found at 1.2860 followed by 1.2900. Overnight UK 10-year bond yields climbed 6 basis points to 0.29%. US 10-year rates were up at 0.87% from 0.8% yesterday. At the end of the day, the US Dollar will dictate where the Pound eventually heads. Look for a choppy trade between 1.2820-1.2920 today. Prefer to buy dips on an overall weaker Greenback scenario.