EUR/GBP takes the bids to 0.8900 amid mixed Brexit news
|- EUR/GBP benefits from the headlines suggesting increased Brexit uncertainty.
- EU allows one week to UK PM Johnson for a better deal, the Tory leader gains support at home.
- US political/Fed news adds to the pair’s strength ahead of the key day.
One more failure to stay below 21-day SMA joins political headlines from the US/EU to help the EUR/GBP pair rise to 0.8900 amid Friday morning in Asia.
The UK Times' storythat the European Union (EU) has given a one-week ultimatum to the United Kingdom’s (UK) Prime Minister (PM) Boris Johnson to come up with a better Brexit deal seems to indicate the British Pound (GBP) liquidating some of its recent gains while moving forward.
The GBP previously benefited from the news surrounding the Tory leaders’ Brexit proposal, also conveyed by the Sun’s story mentioning Labour rebels’ readiness to help the deal pass through the Parliament.
Earlier during the day, headlines form the Washington Post (WaPo) and the Wall Street Journal (WSJ) signaled increase in political uncertainty surrounding the United States (US) President Donald Trump’s impeachment and dragged the US Dollar (USD) down, which in turn helped the Euro (EUR).
Further to note is the latest downbeat commentary from the US Federal Reserve’s Vice Chairman Richard Clarida who highlighted macro fears exerting downside pressure on the world’s largest economy.
It should also be noted that no major data/event is scheduled from either the Eurozone or the UK and hence political/Brexit headlines will offer direction to the pair traders.
However, a speech from the European Central Bank (ECB) policymaker Luis de Guindos, coupled with the US jobs report and the Federal Reserve Chairman’s speech, won’t lose their importance to the markets.
Technical Analysis
A daily closing below 21-day simple moving average (SMA) level of 0.8885 becomes necessary for the pair to visit September 23 high nearing 0.8865 and the previous month low near to 0.8785. On the upside, 0.8940 and 0.8975 can question buyers targeting 0.9000 round-figure.
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