GBP/USD benefits from UK/US trade optimism amid British political plays

GBP/USD stays above 100-day EMA as the US-UK leaders agree over a trade deal by July 2020.
Tories keep lagging behind EU’s expectations while the opposition Labour party leader Jeremy Corbyn grabbed the headlines.

Anil Panchal FXStreet

The GBP/USD pair benefited from the Sun’s story favoring the US-UK trade deal at the time of no fresh Brexit headlines. The quote takes the bids to 1.2490 while heading into the London open on Monday.

The US President Donald Trump and the United Kingdom’s (UK) Prime Minister (PM) recently agreed to sign a trade deal by July 2020 in a lightning-fast speed says the Sun. However, no major details have been shared for the same.

On the Brexit front, the EU-UK Brexit negotiators are still at loggerheads as far as the Irish border issue is concerned. Latest news from the Financial Times (FT) conveys the EU’s lack of appreciation to the British proposals concerning Irish backstop. Though, both the teams will still debate the issue for some more time before heading to the United Nations’ conference. Elsewhere, the opposition Labour party will vote for party agenda for the referendum after elections where the leader Jeremy Corbyn recently surprised fellow politicians by saying that the UK will be better off the EU. Furthermore, the case against the UK PM’s parliament prorogation will be discussed in the Supreme Court with a final hearing likely to roll out on Tuesday.

On the other hand, the US-China trade drama continues with the Chinese delegates’ early leave from the US spreading negative vibes while the geopolitical tension from the Middle East also contributing to the US Dollar (USD) demand.

Given the lack of major data/event scheduled for publishing, investors will keep an eye over the monthly purchasing manager index (PMI) numbers for the US while also taking care of the trade/political news. Further, the European Central Bank’s (ECB) conference in Frankfurt will also offer speeches from some key central bank policymakers and hence should be observed closely.

Technical Analysis

100-day exponential moving average (EMA) level of 1.2470 could keep limiting pair’s near-term declines, highlighting the importance of 200-day EMA level of 1.2660 as the key resistance. In a case of pair’s declines below 1.2470, 1.2385/80 seems to please bears.

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

AUD/USD holds rebound near 0.6900 on US-China trade optimism

AUD/USD holds the rebound near 0.6900 in the Asian session on Monday. Mixed China's inflation data for October fails to provide any inspiration to the Chinese proxy, the Australian Dollar, but China's extension of the suspension of 24% tariffs on US goods and reduced US-Iran tensions help the Aussie pair cling to recovery gains.

USD/JPY retreat in sync with USD, appraches 158.00

USD/JPY is back in the red at the start of the week on Monday, eyeing the broad US Dollar retreat amid easing US-Iran tensions. Traders also resorting to profit-taking following the blockbuster US Nonfarm Payrolls data-led rally. US CPI report is next in focus.

Gold: $4,100 reclaimed. Will buyers succeed ahead of US inflation test?

Gold is back above the $4,100 mark, kicking off a big week on Monday with a strong rebound. However, it remains to be seen whether the bright metal sustains another attempt above that level ahead of critical US Consumer Price Index data due on Tuesday.

Top 3 Price Predictions: Bears in control, with next support at BTC $70,000, ETH around $2,000 and XRP near $1

Bitcoin (BTC), Ethereum (ETH) and Ripple (XRP) bears remain in control, with the top three cryptocurrencies correcting over 4%, 6% and 10%, respectively, last week and marking their fifth consecutive weeks of losses. BTC trades around $75,530 on Monday after closing below key Exponential Moving Averages (EMAs), leaving the $70,000 level as its next major support.

AI selloff: What bonds and credit markets reveal

The recent selloff in US technology stocks has left investors with a difficult question. Are we simply looking at a correction after months of strong performance, or is the market starting to reflect deeper problems in the economy? The Nasdaq 100 has lost as much as 16.3% from its record high, while the Philadelphia Semiconductor Index has experienced an even sharper decline.

US Dollar breaks below 101.50 as Democrats sweep Congress

The US Dollar (USD) comes under heavy selling pressure on Wednesday, with the US Dollar Index (DXY) falling around 0.5% to trade near 101.35 after sliding below the 101.50 level. The Greenback retreats to its lowest level in four weeks as investors reassess the political and economic outlook following the Democratic Party's sweeping victory in the United States (US) midterm elections.