The British pound is rebounding following the sell-off from Monday. The declines were set off by dovish remarks from BoE Governor Carney. Although the currency pair is paring losses from Monday, the downside risks remain. EU negotiator Barnier contradicted claims from PM Johnson about the border checks. This remains one of the key points of conflict in the Brexit talks.
GBP/USD Could Rise to Fill the Gap
Price action in the currency pair is somewhat consistent with the bullish divergence on the 4-hour chart time frame. This indicates a minimum upside correction to 1.3068.
Considering that price left an unfilled gap from earlier this week, we expect the gains to be modest in nature. Price action is likely to remain within the 1.3100 and 1.2960 levels in the near term.
