The GBP/USD pair rallied to over one-week tops on Friday, albeit continued with its struggle to sustain above the 1.3100 handle. The broad-based US Dollar weakness, amid firming expectations that the Fed will hold interest rates steady through 2019, was seen as one of the key factors benefitting/driving the pair higher. The uptick, however, lacked strong conviction and the pair finally settled around 60-pips off session tops despite the latest development, wherein the EU leaders granted the UK a second Brexit extension until Oct. 31.
The lack of progress in cross-party talks between the UK PM Theresa May and opposition leader Corbyn, aimed to break the Brexit deadlock, held investors from placing any aggressive bullish bets kept a lid on any meaningful up-move. The downside, however, remained cushioned and the pair managed to regain some positive traction at the start of a new trading week amid persistent US Dollar selling bias, this time on the back of US-China trade optimism.
In absence of any major market moving UK economic releases, the pair remains at the mercy of the USD price dynamics and any incoming Brexit-related headlines. Later during the early North-American session, the release of Empire State Manufacturing Index from the US and comments by external BoE MPC Member Jonathan Haskel will also be looked upon to grab some short-term trading opportunities.
From a technical perspective, attempted up-moves seem more likely to remain capped at one-month-old descending trend-line, currently near the 1.3125 region, above which a fresh bout of short-covering might assist the pair to aim towards reclaiming the 1.3200 round figure mark. On the flip side, the 1.3040-30 region, marking the lower end of a short-term ascending trend-channel extending from Dec. 2018 lows, might continue to protect the immediate downside, which if broken should pave the way for a breakthrough the key 1.30 psychological mark and expose the very important 200-day SMA support, currently near the 1.2975 region.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
EUR/USD edges lower toward 1.0700 post-US PCE
EUR/USD stays under modest bearish pressure but manages to hold above 1.0700 in the American session on Friday. The US Dollar (USD) gathers strength against its rivals after the stronger-than-forecast PCE inflation data, not allowing the pair to gain traction.
GBP/USD retreats to 1.2500 on renewed USD strength
GBP/USD lost its traction and turned negative on the day near 1.2500. Following the stronger-than-expected PCE inflation readings from the US, the USD stays resilient and makes it difficult for the pair to gather recovery momentum.
Gold struggles to hold above $2,350 following US inflation
Gold turned south and declined toward $2,340, erasing a large portion of its daily gains, as the USD benefited from PCE inflation data. The benchmark 10-year US yield, however, stays in negative territory and helps XAU/USD limit its losses.
Bitcoin Weekly Forecast: BTC’s next breakout could propel it to $80,000 Premium
Bitcoin’s recent price consolidation could be nearing its end as technical indicators and on-chain metrics suggest a potential upward breakout. However, this move would not be straightforward and could punish impatient investors.
Week ahead – Hawkish risk as Fed and NFP on tap, Eurozone data eyed too
Fed meets on Wednesday as US inflation stays elevated. Will Friday’s jobs report bring relief or more angst for the markets? Eurozone flash GDP and CPI numbers in focus for the Euro.