GBP/USD: Above 1.2550 a sustained can be expected – UOB Group

FXStreet Insights Team FXStreet

The Pound Sterling (GBP) is expected to consolidate in a 1.2460/1.2540 range. In the longer run, GBP has to break and remain above 1.2550 before a sustained advance can be expected, UOB Group’s FX analysts Quek Ser Leang and Peter Chia note.

While above 1.2370, GBP can still test 1.2550

24-HOUR VIEW: “When GBP was at 1.2480 yesterday, we indicated that it ‘could rise further, but given the overbought conditions, a sustained break above 1.2530 appears unlikely.’ We also pointed out that ‘support levels are at 1.2450 and 1.2420.” GBP subsequently dipped to 1.2465, rose to 1.2550, closing at 1.2506 (+0.20%). The price action did not result in any further increase in momentum. This, combined with overbought conditions, is likely to lead to consolidation. Expected range for today: 1.2460/1.2540.”

1-3 WEEKS VIEW: “Our latest narrative was from two days ago (04 Feb, spot at 1.2430), wherein ‘for the time being, we expect GBP to trade in a range of 1.2245/1.2530.’ Yesterday, GBP rose above 1.2530, reaching a high of 1.2550. Upward momentum is increasing, but not enough to suggest a sustained advance. For a sustained advance, GBP has to break and remain above 1.2550. The probability of GBP breaking clearly above 1.2550 will remain intact as long as 1.2370 (‘strong support’ level) is not breached.”

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

AUD/USD shows resilience below 38.2% Fibo. near mid-0.7100s

The AUD/USD pair touches a one-and-a-half-week low, around the 0.7140 region during the Asian session on Monday, though it lacks follow-through. Spot prices currently trade just above mid-0.7100s, down nearly 0.25% for the day.

USD/JPY: Japanese Yen edges lower vs USD amid Middle East jitters as Fed, BoJ meetings loom

The USD/JPY pair attracts some buyers at the start of a new week and climbs closer to the 154.00 mark during the Asian session, reversing a part of Friday's losses. Spot prices, however, remain confined in a range held over the past week or so and within striking distance of a nearly seven-month low, touched last Tuesday, as traders await this week's key central bank events.

Gold: Fed’s rate decision to drive the next move

Gold reflects a subdued performance at the start of the Federal Reserve’s (Fed) monetary policy week at around $4,330. Fed’s interest rate expectations heavily influenced last week after the release of the hot United States (US) Producer Price Index (PPI) and Consumer Price Index (CPI) reports for August.

Pi Network extends gains as ecosystem development supports recovery

Pi Network (PI) extends its recovery on Monday, trading above $0.097 after two consecutive weeks of gains. Continued ecosystem development and improved developer tools are boosting utility. Meanwhile, the technical indicators point to a tentative recovery, but overhead Exponential Moving Averages remain a challenge and cap PI gains.

Canada CPI expected to show steady inflation in August

Canada’s August Consumer Price Index figures will be the focus of attention when published on Monday. Indeed, Statistics Canada data will provide markets with an update on price pressures following the Bank of Canada’s September 2 meeting, when officials kept the interest rate steady at 2.25%, broadly in line with analyst consensus.

Venezuela’s 65-billion-barrel Oil deal could reshape America’s inflation fight

The United States (US) has secured unprecedented access to part of Venezuela’s vast Oil reserves. The timing is particularly significant as the war with Iran is disrupting Middle Eastern supplies, keeping energy prices elevated and reviving concerns about inflation.