GBP underpinned in the short-term before moving lower – Nordea

Sandeep Kanihama FXStreet Contributor

Morten Lund, analyst at Nordea Markets, points out that GBP has rallied on the back of the election result, sending EUR/GBP lower to levels around 0.829.

Key Quotes

“Given our expectations of a divorce deal being ratified before 31 January 2020, we expect the GBP to be somewhat underpinned the next month or so. Hereafter, however, we see clear downside risk for the GBP, as focus then switches to the phase two negotiations concerning the more important and probably also more difficult future trade relationship.”

“Furthermore, we do not think the economy will see a big investment boom after a potential divorce deal has been ratified, with key figures continuing to be sluggish. As such, our view on the sterling is more in line with the option market, which is clearly positioned for downside GBP risk in 2020.”

Author

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

EUR/USD stays depressed near 1.1850 ahead of German ZEW

EUR/USD remains in the red near 1.1850 in the European session on Tuesday. A broad US Dollar bullish consolidation combined with a softer risk tone keep the pair undermined ahead of the German ZEW sentiment survey.

GBP/USD drops below 1.3600 after weak UK jobs report

GBP/USD is seeing a fresh selling wave, giving up the 1.3600 level in Tuesday's European trading. The United Kingdom employment data showed worsening labor market conditions, bolstering bets for a BoE interest rate cut next month. This narrative is weighing heavily on the Pound Sterling.

Gold pares intraday losses; keeps the red above $4,900 amid receding safe-haven demand

Gold (XAU/USD) attracts some follow-through selling for the second straight day and dives to over a one-week low, around the $4,858 area, heading into the European session on Tuesday.

Pi Network rallies ahead of its first anniversary

Pi Network trades above $0.1800 at the time of writing on Tuesday, recording nearly 5% gains so far. On-chain data indicate that large wallet investors, commonly known as whales, have accumulated approximately 4 million PI tokens over the last 24 hours.

The week ahead: Key inflation readings and why the AI trade could be overdone

It is likely to be a quiet start to the week, with US markets closed on Monday for Presidents Day. European markets are higher across the board and gold is clinging to the $5,000 level after the tamer than expected CPI report in the US reduced haven flows to precious metals.

Stellar mixed sentiment caps recovery

Stellar price remains under pressure, trading at $0.170 on Tuesday after failing to close above the key resistance on Sunday. The derivatives metric supports the bearish sentiment, with XLM’s short bets rising among traders and funding rates turning negative.