GBP/USD slips in thin trade as markets eye UK CPI

💡 DMK Insight

The GBP’s slight dip to 1.3635 amid thin liquidity highlights the impact of market closures. With US markets closed for President’s Day, trading volumes are low, which can amplify price movements. This environment often leads to erratic behavior in currency pairs like GBP/USD. Traders should be cautious, as thin liquidity can result in wider spreads and increased volatility. If the GBP continues to struggle against the dollar, watch for support levels around 1.3600. A break below that could signal further downside, while a rebound could test resistance near 1.3700. It’s also worth noting that the current retreat might not reflect broader market sentiment, as the lack of US participation could skew the price action. Keep an eye on upcoming economic data releases that could influence the GBP’s trajectory once liquidity returns, particularly any news from the UK regarding inflation or interest rates, which could provide clearer direction.