GBP/USD: Breakout remains elusive even as UK heads for December election


  • GBP/USD remains stuck at key resistance despite the UK parliament approving the December election. 
  • A flag breakout on the 4-hour chart would revive the bullish view. 
  • The bull flag will likely fail if the Federal Reserve delivers a hawkish rate hike. 

GBP/USD's struggle for a flag breakout continues even though the UK parliament on Tuesday backed a general election on December 12.

The House of Commons on Tuesday approved legislation paving the way for the first December election since 1923, according to the BBC. The bill is expected to become a law by the end of the week. 

Even so, the British Pound is struggling to draw bids. The currency pair is currently trading at 1.2863 and has spent a better part of the last 12 hours chipping away at the resistance of the bull flag on the 4-hour chart. 

A flag breakout, if confirmed, would imply a continuation of the rally from recent lows near 1.22 and could pave the way for a re-test of the Oct. 21 high of 1.3012. 

The breakout, however, may remain elusive or fail if the Federal Reserve cuts rates by 25 basis points and signal a rate cut pause, sending Treasury yields and the US Dollar higher across the board. It is worth noting that the market has already priced in a 25 basis point rate cut. 

Ahead of the Fed rate decision, the pair may also take cues from the US Q3 preliminary GDP and the monthly ADP jobs data. 

Technical levels

GBP/USD

Overview
Today last price 1.286
Today Daily Change -0.0008
Today Daily Change % -0.06
Today daily open 1.2868
 
Trends
Daily SMA20 1.265
Daily SMA50 1.245
Daily SMA100 1.2434
Daily SMA200 1.2715
 
Levels
Previous Daily High 1.2906
Previous Daily Low 1.2804
Previous Weekly High 1.3013
Previous Weekly Low 1.2787
Previous Monthly High 1.2583
Previous Monthly Low 1.1958
Daily Fibonacci 38.2% 1.2867
Daily Fibonacci 61.8% 1.2843
Daily Pivot Point S1 1.2813
Daily Pivot Point S2 1.2758
Daily Pivot Point S3 1.2711
Daily Pivot Point R1 1.2914
Daily Pivot Point R2 1.2961
Daily Pivot Point R3 1.3016

 

 

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.

Feed news

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD falls amid Sino-American tensions ahead of Non-Farm Payrolls

EUR/USD is trading around 1.1850, down amid a risk-off mood stemming from President Trump's move against China's TikTok and WeChat. Tension is mounting ahead of the highly uncertain Non-Farm Payrolls.

EUR/USD News

Gold consolidates near record highs, flat-lined around $2060 area ahead of NFP

Concerns about escalating US-China tensions pushed gold to fresh record highs on Friday. A goodish pickup in the USD prompted some profit-taking amid overbought conditions. 

Gold News

GBP/USD retreats amid doubts about the furlough scheme, dollar strength

GBP/USD is trading closer to 1.31 as UK Chancellor Rishi Sunak said the furlough scheme that is underpinning the economy cannot last forever. The dollar is gaining ground amid geopolitical tensions ahead of the Non-Farm Payrolls.

GBP/USD News

Forex Today: Dollar ticks up after Trump's TikTok move, all eyes on Non-Farm Payrolls

Trump's executive order against TikTok and WeChat has dampened the market mood and strengthened the dollar. Fiscal stimulus have made limited progress and investors are now focused on July NFP, which carries high uncertainty amid the resurgence of coronavirus. 

Read more

WTI struggles to keep $42.00 amid risk-off in Asia

WTI extends the previous day’s losses from $42.79, recently bounces off the intraday low. US-China and Washington-Ottawa tussles join dimming hopes of US stimulus to weigh on the risk-tone.

Oil News

Forex MAJORS

Cryptocurrencies

Signatures