The greenback gained some additional ground on Thursday, with the US Dollar Index now eyeing to reclaim the key 100.00 psychological mark as investor turn their focus back to the strength of the US economy. The buck also benefited from optimistic remarks from two Fed officials - Chicago Fed President Charles Evans and Boston Fed President Eric Rosengren (non-voting member), supporting the case for gradual Fed rate-hikes in light of the incoming data pointing to solid fundamental of the US economy. Hence, the final revision of the US GDP numbers for the fourth quarter of 2016 would grab the spotlight later during early NA session. Apart from the growth numbers, speeches from speeches from couple of FOMC members - Dallas Fed President Robert Kaplan and San Francisco Fed President John Williams would also be looked upon for impetus during the NY trading session.
GBP/USD
The GBP/USD pair on Wednesday fell to as low as 1.2375 before bouncing back after the UK formally kicked-off the Brexit proceedings. The pair's weakness over the past couple of day could be attributed to renewed worries over possibilities of a hard Brexit. The pair, however, stalled the downslide as investors now await response from Donald Tusk, President of the European Council, which has the potential to trigger fresh bout of volatility across GBP crosses.
Adding to this, possibilities of yet another Scottish independence referendum also weighed on the British Pound. The Scottish Parliament, on Wednesday, approved a plan to request another independence referendum and granted first minister Nicola Sturgeon the authority to negotiate with Westminster on holding another vote.
Technically, the pair managed to bounce off from closer to 50% Fibonacci retracement level of 1.2109—1.2616 recent up-move and held 100-day SMA support on daily closing basis. The recovery move, however, as failed to gain further traction and the pair remained stuck within a narrow trading range below mid-1.2400s. Hence, it would be prudent to wait for a decisive move on either side before determining the pair’s near-term trajectory.
Momentum above mid-1.2400s is likely to confront immediate resistance near 1.2475 horizontal level, closely followed by 23.6% Fibonacci retracement level hurdle near 1.25 important psychological mark. A decisive break through the 1.25 handle, leading to a subsequent momentum above 1.2550-55 resistance now seems to pave way for continuation of the pair’s near-term appreciating move, even beyond 1.2600 round figure mark, towards its next major hurdle near 1.2685-90 region marking the very important 200-day SMA.
On the downside, 100-day SMA near 1.2420 region might continue to act as immediate support, below which the pair is likely to head back towards testing 50% Fibonacci retracement level support near 1.2370-75 region. On a convincing break below 1.2370-75 support, the pair is likely to accelerate the slide towards 61.8% Fibonacci retracement level support near the 1.2300 handle, en-route 1.2215-10 support area.
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 trades weak below 1.0800 amid Good Friday lull, ahead of US PCE
EUR/USD continues its downward trend for the fourth consecutive day, driven by a stronger US Dollar influenced by the hawkish market sentiment surrounding the Federal Reserve and expectations of prolonged higher interest rates.
GBP/USD: The first downside target is seen at the 1.2600–1.2605 zone
GBP/USD trades on a weaker note around 1.2620 during the early European session on Friday. The decline of Pound Sterling is backed by the growing speculation that the Bank of England will begin the rate-cut cycle this year.
Gold ends Q1 2024 at record highs, what’s next?
Gold is sitting at an all-time high of $2,236, lacking a trading impetus amid holiday-thinned conditions on Good Friday. Most major world markets, including the United States are closed in observance of Holy Friday, leaving volatility around Gold price highly subdued.
Ripple's move above this key level could trigger nearly 50% rally for XRP
Ripple price has overcome a critical resistance level and flipped into a support floor on the weekly time frame. This development happened while XRP tightly consolidated for roughly 250 days.
US core PCE inflation set to ease in February on month as Federal Reserve rate cut bets for June mount
The core Personal Consumption Expenditures Price Index is set to rise 0.3% MoM and 2.8% YoY in February. The revised Summary of Projections showed that policymakers upwardly revised end-2024 core PCE forecast to 2.6% from 2.4%.