GBP/USD confined in a narrow range around 1.2450 level

The GBP/USD pair struggled for direction and was confined within a 30-pips narrow trading range during Asian session on Thursday. 

Currently hovering around mid-1.2400s, the pair on Wednesday failed to build on its recent up-move and clear 1.25 psychological barrier. The pair subsequently witnessed a reversal from higher levels against the backdrop of a downward revision of yearly UK GDP growth and disappointing business investment figures. In addition to this, persistent greenback strength also weighed on the major and dragged it to retest 100-day SMA support.

Later during NY session, the pair managed to bounce off lows after the Fed minutes expressed concerns over uncertainty surrounding the US President Donald Trump's pro-growth policies, albeit indicated a desire to raise interest rates "fairly soon". The minutes failed to provide an additional boost to the greenback and helped the pair to defend an important confluence support near 1.2415-10 region, comprising of a short-term ascending trend-line & 100-day SMA.

With a relatively thin economic docket on Thursday, featuring the release of usual weekly jobless claims data from the US, the pair remains at the mercy of the US Dollar price-dynamics. 

Technical levels to watch

On the downside, 100-day SMA near 1.2415-10 region remains immediate support to defend, which if broken could accelerate the slide towards 1.2385-80 horizontal support before the pair eventually breaks through Feb. lows support near 1.2350-45 region and head towards 1.2330-25 support area.

Conversely, momentum above 1.2470 immediate hurdle could get extended back towards 1.2500 mark. A sustained strength above 1.25 important resistance now seems to trigger a short-covering rally towards 1.2545-50 horizontal resistance ahead of 1.2580 level (Feb. 9 high).