• GBP/USD dipped on Friday after UK november retail sales unexpectedly contracted, highlighting continued pressure on consumer demand.
• Retail sales fell 0.1% month on month, sharply missing expectations for a 0.4% increase, while government borrowing also came in higher than forecast, adding to concerns over the UK’s fiscal position.
• The move pushed cable to its lowest level since Thursday, retreating from a nine-week high of 1.3460 touched earlier in the week.
• Thursday’s session low stood at 1.3361, recorded ahead of a cautious interest-rate cut by the Bank of England and softer U.S. CPI data, which had temporarily supported sterling.
• Immediate resistance is located at 1.3450( Dec 18th high), any close above will push the pair towards 1.3498(61.8%fib)
• Strong support is seen at 1.3348(50%fib) and break below could take the pair towards 1.3306(SMA 20).
Recommendation: Good to buy around 1.3350, with stop loss of 1.3250 and target price of 1.3450
