• Brexit uncertainties continue to weigh on the British Pound and helped regain traction.
• Some renewed weakness in the shared currency seemed to cap any strong follow-through.
The EUR/GBP cross quickly reversed a dip to sub-0.8800 level and has now moved back within the striking distance of four-month tops set on Friday.
After Friday's modest pullback, the cross managed to find decent support near the very important 200-day SMA and was being supported some renewed selling around the British Pound. The fact that a pro-Brexit hardliner Boris Johnson is a leading candidate to replace the outgoing PM Theresa May, concerns about a no-deal spilt kept exerting some downward pressure on the Sterling.
It is worth reporting that after facing immense pressure amid disagreements on her revised Withdrawal Agreement Bill, PM May finally announced on Friday that she will be stepping down as Conservative Party leader on June 7th. However, the leadership contest will only get underway in the second week of June, which might eventually fail to provide any immediate respite for the GBP bulls.
However, a fresh bout of weakness in the shared currency, led by declining yields in the German bund yields amid growing concerns about a sharp economic slowdown in the Euro-zone, did little to provide any additional boost and might turn out to be the only factor keeping a lid on any subsequent up-move, at least for the time being.
Investors also seemed reluctant to place any aggressive bids and remained on the sidelines in wake of relatively thin liquidity conditions on the back of Spring Bank Holiday in the UK. Hence, it would be prudent to wait for a follow-through buying before positioning for any further positive move amid near-term overbought conditions on the daily chart.
Technical levels to watch
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
AUD/USD risks a deeper drop in the short term
AUD/USD rapidly left behind Wednesday’s decent advance and resumed its downward trend on the back of the intense buying pressure in the greenback, while mixed results from the domestic labour market report failed to lend support to AUD.
EUR/USD leaves the door open to a decline to 1.0600
A decent comeback in the Greenback lured sellers back into the market, motivating EUR/USD to give away the earlier advance to weekly tops around 1.0690 and shift its attention to a potential revisit of the 1.0600 neighbourhood instead.
Gold is closely monitoring geopolitics
Gold trades in positive territory above $2,380 on Thursday. Although the benchmark 10-year US Treasury bond yield holds steady following upbeat US data, XAU/USD continues to stretch higher on growing fears over a deepening conflict in the Middle East.
Bitcoin price shows strength as IMF attests to spread and intensity of BTC transactions ahead of halving
Bitcoin (BTC) price is borderline strong and weak with the brunt of the weakness being felt by altcoins. Regarding strength, it continues to close above the $60,000 threshold for seven weeks in a row.
Is the Biden administration trying to destroy the Dollar?
Confidence in Western financial markets has already been shaken enough by the 20% devaluation of the dollar over the last few years. But now the European Commission wants to hand Ukraine $300 billion seized from Russia.