The dollar slid across the board during the US morning session in a technical move. After the sterling broke 2.0550 against the dollar, the rally accelerated to reach as high as 2.0585. The euro rose to a fresh all-time high at 1.3842 versus the dollar.
The sterling rebounded following a stronger-than-expected UK second quarter GDP report, bolstering odds that the Bank of England may raise rates once more this year. UK economy grew by 0.8% on a quarter on quarter basis, beating the estimate of 0.7% and faster than a 0.7% growth rate in the previous quarter.
As housing issues remain the major concern especially after Fed Chairman Bernanke’s testimony, the overall sentiment over the greenback is still bearish.
GBPUSD encounters interim resistance at 2.0580, backed by 2.0600 and 2.0630. Subsequent ceilings will emerge at 2.0650, followed by 2.0680 and 2.0700. On the downside, support begins at 2.0520, followed by 2.0500 and 2.0480. Additional floors are eyed at 2.0450, backed by 2.0420 and 2.0400.
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