• GBP/USD slipped lower on Friday after UK economy unexpectedly contracts in January.
• Gross Domestic Product (GDP) fell by 0.1% in January, mainly due to a sharp decline in industrial output compared to December, according to the Office for National Statistics on Friday.
• The reading represents a disappointment for finance minister Reeves, whose number one mission is to get the economy growing.
• Reeves will present new economic and fiscal forecasts in her March 26 Spring Statement, as weak growth and higher borrowing costs impact the fiscal margin from October’s budget.
• At GMT 09:46, the pair was trading down 0.33% at 1.2940, retreating from daily high 1.2974.
• Immediate resistance is located at 1.2987(23.6%fib), any close above will push the pair towards 1.3065(Higher BB)
• Strong support is seen at 1.2872(March 11th low) and break below could take the pair towards 1.2847(38.2%fib).
Recommendation: Good to buy around 1.2930, with stop loss of 1.2850 and target price of 1.3050
