GBP/USD: Bears target 1.2800 as DXY bounces

Dhwani Mehta FXStreet

The buying interest in the US dollar gathered pace across the board over the last hours, knocking-off GBP/USD sharply towards 1.28 handle.

Cable broke its Asian consolidative mode in early Europe, and came under aggressive selling pressure, mainly driven broad based US dollar rebound, despite a pause in the US yields rally.

Markets prefer to hold the US currency ahead of the Trump administration’s tax overhaul announcement due later in the American. However, the USD bounce may not last longer, as markets already believe that today’s announcement on tax reforms plan could once again lack details.

Moreover, a turnaround in risk condition, with risk-off seeping back into markets amid negative oil and subdued European equities, also added to the renewed downside seen in the spot.

GBP/USD Levels to consider

A break above 1.2842/ 51 (daily top/ Apr 20 high) could lift the pair above 1.2871 (Apr 24 high), beyond which a test of 1.2912 (flash rally high) is imminent. Conversely, a break below 1.2819 (5-DMA), leading to a subsequent break below 1.2763/58 (10-DMA/ Apr 21 low) is likely to drag the pair towards testing its next support near 1.2722/00 (classic S3/ zero figure).

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

GBP/USD flirts with tops near 1.3470

GBP/USD manages to regain composure and challenge the area of daily highs around 1.3470 on Friday. Cable picks up pace despite marginal gains in the Greenback in a context of swelling geopolitical tensions and rising global oil prices.

EUR/USD trims losses, back above 1.1500

EUR/USD picks up some pace and bouces off earlier lows, reclaiming the 1.1500 threshold and beyond at the end of the week. The pair’s modest pullback follows a persistent risk-averse market mood and renewed buying interest for the US Dollar.

Gold: The $4,000 mark holds the downside for now

Gold faces renewed selling pressure, falling sharply toweard the $4,000 mark per troy ounce as the US Dollar regains momentum. Escalating US-Iran tensions are keeping inflation concerns and expectations of further Fed rate hikes alive, weighing further on the yellow metal.

Bitcoin eyes 50-day EMA breakout, Ethereum consolidates, XRP steadies

Bitcoin, Ethereum, and Ripple trade near key technical levels on Friday as the broader cryptocurrency market pauses following last week's recovery. BTC is approaching the 50-day Exponential Moving Average while ETH continues to consolidate between two major EMAs.

Warsh needs to restore his reputation

We were glad to see our deeply negative reaction to the Warsh press conference was not some personal peculiarity. Just about everybody in the financial press felt the same way. The consensus is building it’s not the Fed in the dog-house but only Warsh. Today the WSJ changed it tune and blasted Warsh—"the honeymoon is already over..”

9-3: Is the Federal Reserve’s vote tally Warsh's new forward guidance?

The rate did not move. Neither did the statement, and that’s the more interesting fact. Set the July 29 Federal Open Market Committee (FOMC) statement beside the one issued on June 17, and the two documents are identical apart from a single verb and a paragraph at the bottom naming three dissenters.