- GBP/USD prints three-day winning streak despite easing off-late.
- UK Brexit Minister Frost hints Brexit trade deal “early next week”.
- UK PM Johnson came in contact with a covid-positive, will work via Zoom.
- Vaccine hopes firm up but fail to defy the virus woes.
GBP/USD cools down to 1.3220, up 0.18% intraday, while heading into Tuesday’s London open. The Cable refreshed the intraday high to 1.3233 in early Asia after The Sun came out with news supporting the Brexit deal between the UK and the European Union (EU). However, mixed sentiment and a lack of major/events join the cautious sentiment ahead of BOE Governor Andrew Bailey’s speech to challenge the bulls.
Having earlier conveyed that the UK will is strict on its red lines while the Brexit talks continue, the British diplomats suggest a soon to realize trade deal with the EU. The forecasts, as conveyed by the UK Chief Brexit Negotiator David Frost, fall short of conveying no solution of the key hurdles like fisheries and level playing field. The latest developments suggest that Brexit talks are on and the Irish PM Micheál Martin also mentioned the gut instinct of the UK to have a trade deal.
Elsewhere, Reuters came out with the news suggesting UK PM Boris Johnson’s contact with a coronavirus (COVID-19) positive, as well as sound health conditions afterward. The news also conveys the Tory leaders’ readiness to work via Zoom to maintain the social distancing norms intact for the next two weeks.
Trading sentiment struggles to keep Monday’s optimism as vaccine hopes triggered by Moderna fails to defy the fears of a second national lockdown in the US even if Johnson and Johnson, as well as Pfizer, joins the league of the positive news/updates.
That said, GBP/USD traders may keep 1.3200 while waiting for Bailey’s repetition of the hawkish statements. However, a Reuters poll suggests that the coronavirus is a bigger risk to the U.S. economy than a prolonged dispute over the presidential election result, which in turn can weigh on the Sterling. After the comments from the BOE’s Bailey, US Retail Sales for October will be closely watched for fresh impulse while the risk catalysts can keep the driver’s seat.
Technical analysis
A two-week-old support line, currently near 1.3160, restricts the short-term downside of GBP/USD ahead of 1.3080/75 rest-area. Meanwhile, bullish MACD and sustained trading above 1.3100 favor buyers targeting to refresh the monthly top near 1.3315.
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.