GBP/USD consolidates around 1.2890 amid mixed news from trade/Brexit

GBP/USD recovers from the recent drop to 1.2860.
The EU is widely anticipated to offer a three-month Brexit extension, France doesn’t like it.
The US DOC proposes an investigation of Chinese Aluminium wires’ and cables’ imports while good news from Syria also gets noticed.

Anil Panchal FXStreet

With the mixed sentiment concerning the trade/Brexit restoring the US Dollar (USD) weakness against the British Pound (GBP), the GBP/USD pair bounces off to 1.2890 amid initial Asian trading session on Wednesday.

The pair trimmed more than 100 pips off its five-month high after the United Kingdom’s (UK) House of Commons rejected the motion to push the Brexit proceedings with October 31 be the deadline.

With this, the Prime Minister (PM) Boris Johnson is waiting for the formal approval of the European Union’s (EU) new Brexit date, which is January 2020 as per most market consensus. It should also be noted that the Tory leader previously said that he will call for a snap election on such outcomes. Furthermore, France seems to have a dislike for the widely anticipated three-month Brexit extension.

On the other hand, trade sentiment has been down by the news that the US Department of Commerce (DOC) proposed antidumping duty (AD) and countervailing duty (CVD) investigations of imports of aluminum wire and cable from China to the US International Trade Commission (ITC). However, risk sentiment might have recovered from the US President’s tweet assuring good news from Syria.

While the UK PM’s reaction to the EU’s Brexit extension will be the key to watch, trade/political headlines concerning the US will also be crucial for the Cable traders to follow for fresh direction.

Technical Analysis

Only if the prices manage to break recent high surrounding 1.3013, buyers can take aim at May month top, close to 1.3180, else the quote can revisit June month high around 1.2785.

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.

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