GBP/USD consolidates gains around 1.2900 on the back of a stronger pound
- Pound among top performers on Monday amid UK polls and data.
- Cable rises after falling during four consecutive days.
The GBP/USD pair rose on Monday, ending the American session around 1.2900, with a gain of 65 pips. The pound was among the top performers as polls show the Conservative Party leading ahead of the general election in the United Kingdom.
Expectations of a significant victory for Conservatives increase the odds of a Brexit deal passing the UK Parliament. Prime Minister Johnson’s party announced it would seek a vote on the Brexit deal before Christmas. Also, better-than-expected data contribute to support the pound in the market as the CBI Distributive Trade Survey on realized sales improved to in November to -3 from the previous -10.
The US dollar posted mix results on Monday. It lost ground during the Asian session but the recovered strength on the back of higher US yields. The DXY rose 0.05% and posted the highest daily close since November 13, above 98.30.
Cable with neutral outlook ahead of the Asian session
Valeria Bednarik, Chief Analysts at FXStreet, sees the GBP/USD neutral in the short term. “In the 4 hours chart, the price is battling with directionless 20 and 100 SMA, but above a bullish 200 SMA. Technical indicators lack directional strength, although the Momentum is leaning lower within negative territory, while the RSI steadies around its mid-line.”
Bednarik adds the GBP/USD managed to recover from the 1.2810 price zone, a critical Fibonacci support. “Slides will likely remain contained as long as the price holds above this last.”
Author
Matías Salord
FXStreet
Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.
