GBP/USD analysis: Brexit-related fears to keep weighing on the Pound

Valeria Bednarik FXStreet

GBP/USD Current price: 1.2770

Brexit uncertainty, the main reason for lackluster economic growth.
UK employment data to be out this week but no fireworks expected there.

The GBP/USD pair fell to 1.2722, its lowest since June 2017, as the Pound remained undermined by Brexit-related fears, unable to attract investors after a batch of mostly positive data. According to the official releases, the UK preliminary Q2 GDP expanded as expected 0.4% QoQ, matching the market's forecast, and better than the previous 0.2%. Additionally, the June Total Trade Balance deficit shrunk to £-1.861B from a previous £-3.141B. In the same month, Industrial Production expanded 0.4% in and Manufacturing Production also rose 0.4%. UK Finance Minister Hammond attributed the lackluster economic expansion to uncertainty over Brexit but added that chances are that a Brexit trade deal will be achieved. The UK will release this Tuesday fresh employment figures, with the ILO unemployment rate seen steady at 4.2% and wages' growth in line with the recent modest advances. The pair fell for a third consecutive week and for nine days in-a-row, although there are no signs that indicate downward exhaustion, given that in the daily chart, technical indicators maintain their strong downward slopes, with the RSI currently at 23. The 20 DMA is over 200 pips above the current level, bearish, losing relevance for intraday trading. In the 4 hours chart, the pair also presents a bearish stance, with the 20 SMA heading south around 1.2865, the Momentum indicator consolidating in negative territory after a modest upward correction, and the RSI indicator hovering around 24. The mentioned level is a potential target in the case of a due correction.

Support levels: 1.2720 1.2680 1.2645

Resistance levels: 1.2795 1.2830 1.2865

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.

AUD/USD falls to near 0.7100 after slipping below 50-day EMA

AUD/USD depreciates after registering minor gains in the previous day, trading around 0.7120 during the Asian hours. The technical analysis of the daily chart shows the pair consolidating sideways within a rectangle pattern, as neither bulls nor bears gain control. The AUD/USD pair is holding a slight bearish tone however as it sits beneath both the nine-day and 50-day EMAs.

160.00: USD/JPY back near intervention territory after upbeat US jobs report

US Nonfarm Payrolls beat expectations by a wide margin in May, with 172K jobs added. The US Dollar rebounds after the release, helping USD/JPY recover from its intraday lows. Warnings from Japanese authorities continue to limit upside potential near the 160.00 threshold.

Gold targets $4,300 amid stronger Dollar

Gold faces increasing selling interest and navigates the area of three-month lows near the $4,300 mark per troy ounce on Friday. The precious metal’s decline comes as traders assess the stronger-than-expected NFP, while the bid bias in the Greenback and higher US Treasury yields also collaborate with the retracement.

Cardano hits five-year low even as Hoskinson clarifies "break" isn't an exit

Cardano (ADA) price is down 10% at press time on Friday, extending losses over 30% so far this week amid Charles Hoskinson's clarification that "break" isn't an exit.

Week ahead – Fed countdown begins amid US inflation data and geopolitical risks

Fed Chair Warsh’s first meeting approaches as key US inflation data could reshape expectations. Oil prices remain elevated as US-Iran talks continue; tariffs also return to the spotlight. ECB is expected to hike; will it be a one-off move or is July live?

The US economy defies the rules: 100 days into the Oil shock and the recession signal is still missing

More than three months after the start of the Iran war and the resulting disruption to global energy markets, the US economy continues to display remarkable resilience. The conflict has triggered a sharp rise in Oil prices, reignited inflationary pressures and fueled widespread concerns about a potential economic slowdown.