GBP/USD consolidates losses amid pre-NFP lull


  • GBP/USD pauses three-day losing streak.
  • Optimism surrounding domestic employment, among executives help recover Thursday’s losses.
  • UK PM Johnson’s Brexit Bill gets through the House of Commons, Erasmus+exchange scheme, extra offs to UK MPs occupy positive stands.

GBP/USD recovers the latest losses while taking the bids to 1.3080 ahead of the London open on Friday. The pair dropped the previous day after the BOE Governor Mark Carney’s dovish appearance. The latest headlines concerning Brexit, domestic catalysts seem positive. Traders will keep eyes on political news for immediate direction ahead of the US employment data.

The BOE’s Caney triggered the pair Cable’s declines while suggesting nearly 250 pips of rate cuts going forward. The policymaker also said negative about the latest growth forecast and policy risks. Also increasing the pessimism were comments from the EU’s chief Brexit negotiator Michel Barnier who warned the UK over leaving without any deal if it sticks to the timeline of 31-December-2020.

Following the declines, the Cable marked recovery as the UK PM Boris Johnson’s Withdrawal Agreement Bill (WAB) passed the House of Commons by 330 votes to 231 - a majority of 99 votes. The Bill will now reach the House of Lords for scrutiny during the next week.

The bill passed without any changed suggested by the opposition members, not even the protections for child refugees. However, the government’s commitment to maintaining the Erasmus+ program, which funds opportunities for young people to train and study across Europe, seems to please the student fraternity. Further, a second-tier employment indicator and a survey from Deloitte flashed positive signs for the British pound (GBP) buyers. Additionally, the UK Memmbers of the Parliaments (MPs) will have an extra month off as per the new timetable and so fewer questions for the UK PM during the year 2020.

Even so, the market’s risk tone stays sluggish, with the US 10-year treasury yields taking rounds to 1.86%, amid the UK-Canada allegations that Iran was the culprit behind the Ukrainian plane crash.

Looking forward, investors will pay close attention to the political headlines amid the US-Iran tension, which is receding so far. However, the major focus will be on the US employment data for December, Nonfarm Payrolls (NFP) to be very specific. Forecasts favor no change in the US Hourly Earnings and Unemployment Rate figures of 3.1% and 3.5% respectively. Though, NFP is likely to soften to 164K from 266K prior.

Technical Analysis

An upward sloping trend line since November 08, at 1.2965, is on sellers’ radar unless prices successfully trade beyond a 21-day SMA level of 1.3103.

Additional important levels

Overview
Today last price 1.3076
Today Daily Change 9 pips
Today Daily Change % 0.07%
Today daily open 1.3067
 
Trends
Daily SMA20 1.3105
Daily SMA50 1.3015
Daily SMA100 1.2747
Daily SMA200 1.2692
 
Levels
Previous Daily High 1.3125
Previous Daily Low 1.3013
Previous Weekly High 1.3285
Previous Weekly Low 1.3053
Previous Monthly High 1.3515
Previous Monthly Low 1.2896
Daily Fibonacci 38.2% 1.3056
Daily Fibonacci 61.8% 1.3082
Daily Pivot Point S1 1.3011
Daily Pivot Point S2 1.2956
Daily Pivot Point S3 1.2899
Daily Pivot Point R1 1.3124
Daily Pivot Point R2 1.318
Daily Pivot Point R3 1.3236

 

 

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.

Feed news

How do emotions affect trade?
Follow up our daily analysts guidance

Subscribe Today!    

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD: Fears will continue to support the dollar

The EUR/USD pair has lost some ground this week, trading in the 1.1700 price zone. Central banks are cautiously moving toward trimming their massive stimulus programs. Growth-related data suggests a steeper deceleration of economic progress.

EUR/USD News

GBP/USD: Rate laurels go the the US Federal Reserve

BOE leaves rates, asset purchases unchanged, warns on inflation. Federal Reserve and Chair Powell set the stage for bond taper. US Treasury rates move sharply higher after the FOMC meeting. GBP/USD drops below 1.3700 in Friday trading.

GBP/USD News

Gold remains vulnerable amid hawkish Fed outlook

Following the previous week’s decline, gold staged a rebound and closed in the positive territory on Monday and Tuesday. After reaching its strongest level since last Thursday’s sharp decline at $1,787 on Wednesday.

Gold News

PBoC imposes ban on crypto trading as it fosters ‘illegal financial activity’

PBoC bans crypto trading activities and a plethora of associated services, labeling it “illegal.” Overseas cryptocurrency exchanges providing services to Chinese residents will be investigated in accordance with the law. 

Read more

What's next?

As Q3 winds down and Q4 begins, the broad investment climate is being shaped by the turning of the monetary cycle.  Norway was the first, and New Zealand will be next.  It is not so much that these moves will force others to do the same.

Read more

Forex MAJORS

Cryptocurrencies

Signatures