GBP/USD looking to test post-FOMC highs near 1.3150
|- Regains traction amid broad USD softness induced by dovish FOMC statement and Powell.
- US-China trade optimism to outweigh Brexit uncertainty, 1.3200 back on sight.
The GBP/USD pair is on a steady rise so far this Thursday and looks to test the post-FOMC highs at 1.3146, having paused its overnight retreat just ahead of the 1.3100 level.
The strength in the Cable is largely on the back of broad-based US dollar sell-off alongside the Treasury yields after the FOMC statement showed that the Fed switched to a patience stance on future rate hikes amid global growth concerns and muted price pressures. The dovish FOMC called for Goldman Sachs, the US banking giant, to reduce the odds of a March Fed hike to less than 5% vs. 10% previous.
Moreover, the buoyant tone around the higher-yielding pound remains intact amid a risk-on market profile, as traders remain expectant of an US-China trade resolution. The US President Trump is set to meet the Chinese Vice-Premier Liu He later today at 1930 GMT to discuss trade.
Looking ahead, the USD dynamics and the US-China trade-related developments will remain the main drivers for the pair, as markets continue to weigh in the uncertainty around the Brexit deal.
On Wednesday, “EU's Tusk met with PM May for last-minute talks, but his spokesman clarified that the backstop was a part of the withdrawal and was not up for renegotiation. Meanwhile, Labour leader Corbyn urged PM May to rule out a no-deal Brexit, while May responded that, for a no-deal to be out of the table there has to be a deal, and so far, Corbyn didn't back any of her proposals,” Valeria Bednarik, FXStreet’s Chief Analyst noted.
Calendar-wise, the UK docket remains data-light and hence, the focus shifts towards the US weekly jobless claims and regional PMI data for fresh dollar trades.
GBP/USD Technical Levels
Overview:
Today Last Price: 1.3126
Today Daily change: 23 pips
Today Daily change %: 0.18%
Today Daily Open: 1.3103
Trends:
Daily SMA20: 1.2914
Daily SMA50: 1.2784
Daily SMA100: 1.29
Daily SMA200: 1.305
Levels:
Previous Daily High: 1.3146
Previous Daily Low: 1.3054
Previous Weekly High: 1.3214
Previous Weekly Low: 1.283
Previous Monthly High: 1.284
Previous Monthly Low: 1.2477
Daily Fibonacci 38.2%: 1.3111
Daily Fibonacci 61.8%: 1.3089
Daily Pivot Point S1: 1.3056
Daily Pivot Point S2: 1.3009
Daily Pivot Point S3: 1.2965
Daily Pivot Point R1: 1.3148
Daily Pivot Point R2: 1.3193
Daily Pivot Point R3: 1.324
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