GBP/USD Price Forecast: Cautious ahead of key week

GBP/USD manages to keep the trade above the 1.30 mark.
Debate around Brexit is expected to dominate the scenery this week.

Pablo Piovano FXStreet

The sterling gives away part of the gains recorded last Friday on the back of the resumption of some mild buying interest surrounding the greenback on Monday.

Despite Cable has regained the psychological 1.30 mark in past sessions and the move allow for some extra upside in the short-term horizon, the scenario looks fragile for the quid.

Indeed, Brexit headlines are posed to dominate the price action and the volatility in the British pound in the next days ahead of the crucial EU Summit later in the week (October 15-16).

Near-term Outlook

The continuation of the upside momentum in GBP/USD could extend to the Fibo leve just below 1.3200 the figure ahead of 2020 highs around 1.3480 (September 1). This move, however, would need a slew of really positive news around Brexit, which does not seem likely just now. On the downside, the loss of the 1.3000 level carries the potential to re-visit the 1.2870 area (Fibo level) ahead of the key 200-day SMA, today at 1.2709.

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Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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