GBP/USD analysis: Brexit hopes keep boosting the Pound

Valeria Bednarik FXStreet

GBP/USD Current price: 1.3212

EU's Negotiator Barnier made quite encouraging comments about a possible deal.
UK data mixed, with disappointing trade data and GDP growth.

The Pound soared against all of its major rivals on comments from EU's Chief Negotiator Barnier, indicating that a Brexit deal is closer. The GBP/USD pair jumped to 1.3209, its highest since September 26, after Barnier claimed that near the 85% of the Brexit deal has been agreed, although adding that they still need to agree on the Irish border issue. Furthermore, he said that the EU found many points of convergence with UK PM May's Chequers plan. The Sterling is all about Brexit these days, more clear today as the currency appreciated despite mixed local data released at the beginning of the day. Industrial and Manufacturing Production were both up by 1.3% YoY in August, but the trade deficit in the same month increased to £-1.274B, while the monthly GDP growth stayed pat, down from a previous 0.4% advance. On Thursday, the UK will release the BOE Credit Conditions Survey, while BOE's Governor Carney will participate in a panel discussion about the role of regulators and central banks in finances.

The GBP/USD pair seems comfortable above the 50% retracement of the 2016/18 rally, now turned into support at around 1.3175. The pair has been unable to sustain gains for long above the level in the last two months, so caution is recommended, although further positive Brexit-related headlines should keep it on the bullish side. The short-term technical picture favors additional gains, moreover, if the pair breaks above 1.3215, Sep 26 high, as, in the 4 hours chart, technical indicators maintain their upward slopes near overbought readings, while the price advanced well above a firmly bullish 20 SMA.

Support levels: 1.3175 1.3130 1.2990

Resistance levels: 1.3215 1.3245 1.3290

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 clings to strong gains above 1.1850 on USD weakness

EUR/USD preserves its bullish momentum to start the week and trades above 1.1850. The US Dollar struggles to find demand ahead of Wednesday's critical January employment report and helps the pair continue to push higher.

GBP/USD hovers near 1.3600 as UK government crisis weighs on Pound Sterling

GBP/USD moves sideways after registering modest gains in the previous session, trading around 1.3610 during the European hours on Monday. The pair could come under pressure as the Pound Sterling may weaken amid a fresh government crisis in the United Kingdom.

Gold holds steady above $5,000

Gold builds on the gains it posted to end the previous week and holds steady above $5,000 on Monday. Data released over the weekend showed that the People's Bank of China extended its Gold 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.