GBP/USD analysis: consolidating at 4-month lows

Valeria Bednarik FXStreet

GBP/USD Current price: 1.3566

UK holiday kept trading around the Pound limited.
Brexit has the potential of affecting negatively the Sterling these days.

Trading around the GBP/USD pair was quite uneventfully during the first day of the week amid a holiday in London and the absence of macroeconomic headlines coming from major economies. Brexit has returned to the back front in terms of relevance for Pound's direction, with the latest news indicating that UK PM May can't find consensus within her own cabinet about a future trade deal, exacerbating the negative momentum triggered by a batch of disappointing macroeconomic data. This Thursday will be critical, as not only the BOE will announce its latest monetary policy decision, but will also unveil Industrial and Manufacturing Production data for March. In the meantime, the pair is short-term neutral, although consolidating at a 4-month low, with the upside potential well-limited according to technical readings in the 4 hours chart as the pair hovers around a bearish 20 SMA, while technical indicators have managed to regain some ground, the Momentum still heading north around its mid-line, but the RSI already losing its poise and turning south around 43. The pair bottomed last Friday at 1.3485, still the level to break to confirm an extension of the dominant bearish trend.

Support levels: 1.3510 1.3485 1.3450

Resistance levels: 1.3610 1.3645 1.3690

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: US Dollar to remain pressured until uncertainty fog dissipates

Unimpressive European Central Bank left monetary policy unchanged for the fifth consecutive meeting. The United States first-tier employment and inflation data is scheduled for the second week of February. EUR/USD battles to remain afloat above 1.1800, sellers moving to the sidelines.

GBP/USD reclaims 1.3600 and above

GBP/USD reverses two straight days of losses, surpassing the key 1.3600 yardstick on Friday. Cable’s rebound comes as the Greenback slips away from two-week highs in response to some profit-taking mood and speculation of Fed rate cuts. In addition, hawkish comments from the BoE’s Pill are also collaborating with the quid’s improvement.

Gold: Volatility persists in commodity space

After losing more than 8% to end the previous week, Gold remained under heavy selling pressure on Monday and dropped toward $4,400. Although XAU/USD staged a decisive rebound afterward, it failed to stabilize above $5,000. The US economic calendar will feature Nonfarm Payrolls and Consumer Price Index data for January, which could influence the market pricing of the Federal Reserve’s policy outlook and impact Gold’s performance.

Crypto Today: Bitcoin, Ethereum, XRP rebound amid risk-off, $2.6 billion liquidation wave

US NFP and CPI data awaited after Warsh’s nomination as Fed chief. Yen traders lock gaze on Sunday’s snap election. UK and Eurozone Q4 GDP data also on the agenda. China CPI and PPI could reveal more weakness in domestic demand.

Three scenarios for Japanese Yen ahead of snap election

The latest polls point to a dominant win for the ruling bloc at the upcoming Japanese snap election. The larger Sanae Takaichi’s mandate, the more investors fear faster implementation of tax cuts and spending plans.

XRP rally extends as modest ETF inflows support recovery

Ripple is accelerating its recovery, trading above $1.36 at the time of writing on Friday, as investors adjust their positions following a turbulent week in the broader crypto market. The remittance token is up over 21% from its intraday low of $1.12.