Daily Analysis GBPUSD - 18 May 2023

The US Dollar benefited from risk aversion on Tuesday and forced GBP/USD to stay on the back foot. Although latest headlines surrounding the US debt limit negotiations suggest that there could be a deal to raise the debt ceiling by the end of this week, markets remain cautious on Wednesday.

In a recently published report, the Wall Street Journal said that House Democrats were planning to start collecting signatures for a "discharge petition to raise the debt ceiling."

Meanwhile, UK Finance Minister Jeremy Hunt said on Wednesday that they fully support the Bank of England's policy decision and noted that there is nothing that can bring inflation down automatically. These comments, however, failed to help Pound Sterling find demand.

From a technical perspective, the currency pair is exhibiting a similar pattern to other major pairs, with the Dollar gaining strength and a bearish trend taking shape. This trend is pushing the pair to establish new lows, potentially reaching the next support level around 1.2400.

Resi Level 3	Resi Level 2	Resi Level 1	Suppo level 1	Suppo level 2	Suppo level 3
1.2750	1.2650	1.2550	1.2400	1.2350	1.2300