GBP/USD analysis: Brexit arm-wrestling continues

Valeria Bednarik FXStreet

GBP/USD Current price: 1.3090

Irish border issue remains unsolved, UK's Raab not traveling to Brussels this week.
Risk aversion coming from different fronts exacerbated USD gains across the board.

Brexit kept the Pound on a rollercoaster in the first trading day of the week, with the GBP/USD pair hitting 1.3132, surpassing last week's high, but plunging to 1.3027 later, to finally found some stability at around 1.3090. The optimism about the EU offering a “super-charged” free-trade deal faded on dollar strength and comments from UK PM May's spokesman, who said that there is a big difference between optimistic talks and a done deal and that there can't be no withdrawal agreement without a price future framework. Additionally, it was reported that US Brexit Secretary Raab won't be heading to Brussels this week. The UK will only offer the Financial Policy Committee Statement this Tuesday, which most likely will pass unnoticed.

Technically, the pair is still confined to familiar levels, with the upside limited by the 1.3170 area, which stands for the 50% retracement of the 2016/18 rally, but above the 61.8% retracement of the same bullish run at 1.2880. There are no clear signs on directional strength in the 4 hours chart, as the price holds ever since the day started above the 20 SMA and the 200 EMA, both now converging around 1.3040, while technical indicators retreated sharply from overbought readings, the Momentum maintaining its downward strength but above its mid-line and the RSI recovering within positive ground limiting chances of a steeper decline. Seems unlikely that the pair can make a relevant breakout without headlines on whether or not, the EU and the UK reach an agreement on the Irish border issue.

Support levels: 1.3040 1.3000 1.2970

Resistance levels: 1.3100 1.3130 1.3175

View Live Chart for the GBP/USD

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

EUR/USD holds firm near 1.1850 amid USD weakness

EUR/USD remains strongly bid around 1.1850 in European trading on Monday. The USD/JPY slide-led broad US Dollar weakness helps the pair build on Friday's recovery ahead of the Eurozone Sentix Investor Confidence data for February.

GBP/USD holds medium-term bullish bias above 1.3600

The GBP/USD pair trades on a softer note around 1.3605 during the early European session on Monday. Growing expectation of the Bank of England’s interest-rate cut weighs on the Pound Sterling against the Greenback.

Gold remains supported by China's buying and USD weakness as traders eye US data

Gold struggles to capitalize on its intraday move up and remains below the $5,100 mark heading into the European session amid mixed cues. Data released over the weekend showed that the People's Bank of China extended its buying spree for a 15th month in January. Moreover, dovish US Fed expectations and concerns about the central bank's independence drag the US Dollar lower for the second straight day, providing an additional boost to the non-yielding yellow metal.

Cardano steadies as whale selling caps recovery

Cardano (ADA) steadies at $0.27 at the time of writing on Monday after slipping more than 5% in the previous week. On-chain data indicate a bearish trend, with certain whales offloading ADA. However, the technical outlook suggests bearish momentum is weakening, raising the possibility of a short-term relief rebound if buying interest picks up.

Japanese PM Takaichi nabs unprecedented victory – US data eyed this week

I do not think I would be exaggerating to say that Japanese Prime Minister Sanae Takaichi’s snap general election gamble paid off over the weekend – and then some. This secured the Liberal Democratic Party (LDP) an unprecedented mandate just three months into her tenure.

Bitcoin, Ethereum and Ripple consolidate after massive sell-off

Bitcoin, Ethereum, and Ripple prices consolidated on Monday after correcting by nearly 9%, 8%, and 10% in the previous week, respectively. BTC is hovering around $70,000, while ETH and XRP are facing rejection at key levels. Traders should be cautious: despite recent stabilization, upside recovery for these top three cryptocurrencies is capped as the broader trend remains bearish.