GBP/USD close to the 1.31 barrier with a thin Tuesday on the docket

  • GBP/USD on a bearish note after Monday's Brexit headlines gave markets little good news.
  • A thin calendar for Tuesday sees market sentiment once again in control of the major pair.

The GBP/USD pairing is trading near 1.3130 ahead of Tuesday's London market session after a day of declines on Monday.

The Sterling saw little in the way of support to open the week with Brexit headlines once again dragging the GBP lower. Odds of a favorable agreement with EU leaders in Brussels are beginning to look slim, and Prime Minister Theresa May is increasingly caught between a rock and a hard place as EU negotiators continue to show no interest in making concessions for the UK to cherry-pick when and where it gets to remain in EU trade agreements, and hard-line Brexiteers within the UK's parliament continue to show no interest in making concessions in their demands for a complete exit from the EU trade mechanisms. Business leaders continue to face growing fears from the lack of clarity on what the business landscape will look like post-Brexit, and PM May's statements on Monday that she wants to see a customs union relationship maintained with the EU until 2020 did little to assuage market concerns, as the PM's explanations continue to look thin on specific details of how she'll make it work.

Positive data also couldn't support the GBP, with Monday's Markit Manufacturing PMI printing at 54.4 versus the expected 54.0, and Tuesday brings the June Construction PMI at 08:30 GMT, though with markets forecasting a decline from 52.5 to 52.0, it's looking unlikely that the GBP/USD will catch a break on the data, unless the figure prints significantly higher than the expectation.

GBP/USD levels to watch

The Sterling finds itself in a bearish pattern that's beginning to gather strength, and as FXStreet Chief Analyst Valeria Bednarik noted, "the pair fell below the 50% retracement of its latest bullish run, and the 4 hours chart shows that is now finding sellers around a bearish 20 SMA, a few pips above the Fibonacci level, making of the 1.3140 area the immediate resistance. Technical indicators in the mentioned chart have retreated, turning flat in the US afternoon, with the Momentum still above its 100 level but the RSI at around 40, leaning the scale toward the downside."

Support levels: 1.3095 1.3050 1.3010  

Resistance levels: 1.3140 1.3185 1.3220

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.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD stabilizes around 1.1050 amid stimulus speculation

EUR/USD has drifted back to around 1.1050 as markets digest European talk of fiscal stimulus and as the fallout from the Fed's hawkish cut on Wednesday. 


GBP/USD advances toward 1.25 after the BOE, Brexit impasse

GBP/USD is trading closer to 1.25, marginally higher. The BOE left its interest rates unchanged in a unanimous vote. The bank stated that it assumes a smooth Brexit. Uncertainty about the UK's exit prevails.


USD/JPY keeps losses below 108.00 as BOJ disappoints the doves

USD/JPY keeps the losses below 108.00, as the Japanese Yen remains on the front foot in reaction to the Bank of Japan's (BOJ) status-quo that came in as a disappointment for the doves. 


Gold inches higher above $1,500 as US T-bond yields continue to slide

The troy ounce of the precious metal didn't have a difficult time recovering yesterday's losses but continues to trade in its weekly range and doesn't give any signals of a breakout in the near-term. 

Gold News

Bitcoin looks for volatility and shakes the bullish trend

The ruthless crypto market purges the weakest hands of the market –  or perhaps the fastest – and positions are liquidated to take profits after good gains in the short term.

Read more