GBP/USD is heading to the 1.2669 resistance despite a dovish talk from Haldane

• GBP/USD is trading 0.64% higher on Monday and is the outperformer in the G6.
• The price is headed to an important resistance zone at 1.2669.

GBP/USD 4-hour chart

GBP/USD has been reaping the rewards on the euro's demise on Monday as the dollar still struggles. As of yet the Euro Group still have not come to a plan on the rescue fund but there have been some reports that it has shrunk in size. GBP also pulled higher as general sentiment improved at the beginning of the week. A new round of Brexit talks are set to start on Tuesday and there are some suggestions that the UK are asking for a Canada like deal. Tensions between the UK and China also escalated over the weekend but another reason for the GBP boost could be UK PM Johnson cooling the war or words. 

Recent comments from BoE's Haldane have not done much to send GBP lower as the central banker said "the UK is reviewing the case for lower rates". This is not the first time one of the BoE memeber's has spoken about dropping interest rates and it will not be the last. He also added that the UK could do more QE, some pretty dovish language from Haldane.

Looking at the chart below, the price is now moving towards the red area at 1.2669. This area has been a firm resistance zone on three occasions and if there is a break it could be considered as pretty bullish. The rhetoric out of recent Brexit negotiations has been detrimental to the pound so keep an eye on a continuation of this theme. The indicators are looking bullish for obvious reasons. The MACD histogram is in the green and the signal lines have just crossed over the mid-point. The Relative Strength Index is above the 50 line but is not currently facing up. This could be due to the fact the pair is now retesting the trendline it just broke. The trendline does come from the higher timeframe (daily) and connects the highs from 9th March and 10th June. 

Additional levels