GBP/USD flirts with 7-week lows at 1.2165, Budget eyed

A tepid-bounce in GBP/USD faltered near 1.2185 region, with the rate reverting towards seven-week troughs amid resurgent USD demand.

GBP/USD: Will it regain 1.2200 ahead of UK Budget

The GBP/USD pair attempted a minor-recovery over the last hour, as markets remain expectant of an upbeat assessment of the British economy, when the UK Chancellor Hammond presents the Spring Budget later today.

According to the HM Treasury, as cited via Livesquawk, Hammond will note the following in his budget:

• Govt will continue reducing the deficit
• Govt will not shirk difficult decisions on tax and spending
• UK's strong economy built on resilience

However, the bears fought back control, as ‘Hard Brexit’ fears persists across the financial markets, after the UK government faced another defeat in the Brexit‐debate in the House of Lords. The Brexit uncertainty is likely to have a negative impact on the pound going forward.

On the data-front, we have an empty UK docket, and hence, the US ADP jobs data will remain in focus later today.

GBP/USD Levels to consider            

At 1.2170, the resistances are lined up at 1.2248/53 (5-DMA/ previous high) and 1.2303/04 (10-DMA/ Mar 6 high) and above that at 1.2333/50 (classic R3/ round figure). On the flip side, the resistances are aligned at 1.2121 (classic S2/ Fib S3) and 1.2100 (psychological levels) and below that at 1.2050 (Flash crash territory).