GBP/USD: good news or bad news?

The British Pound can't gather pace upward, despite dollar's generalized weakness, as UK data released this Tuesday resulted below expected. The pair trades within Monday's range, marginally lower in the day, but stuck around the 1.3100 figure, as the greenback suffers its own woes. In the UK, inflation remained steady at 3.0% in October, below market's expectations of an advance toward 3.1%. Producer Prices and the Retail Price index also rose by less-than-expected, but remain near the latest highs. Lower UK inflation means inaction from the BOE, and despite good news in the current situation, ended up weighing on the Pound. In the US, Producer prices rose more than expected in October, up 0.4% in October, against a 0.1% increase expected, amid higher services' costs. The core reading, ex-food and energy, also rose by 0.4% against the expected 0.2%. Technically the 4 hours chart shows that the price is moving back and forth around the 23.6% retracement of its latest decline, still below its 20 SMA and with technical indicators heading marginally lower within bearish territory, leaning the scale towards the downside. Still, the pair would need to break below the 1.3060 support to confirm additional declines ahead that could extend through the key 1.3000 threshold.

Support levels: 1.3095 1.3060 1.3025

Resistance levels: 1.3145 1.3180 1.3220

View Live Chart for the GBP/USD

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