GBP/USD consolidating around 1.3000 after pulling back from 1.3140

GBP/USD moving sideways around 1.3000.

Biden takes the lead on the vote count and the USD pulls back.

The market ignores the weaker than expected ADP employment report.

The pound sterling is consolidating around the 1.3000 level, trading on a moderate sell tone after pulling back from nearly two-week highs at 1.3140 earlier today.

The dollar loses ground as Biden takes the lead

The sterling remains negative on daily charts despite the US dollar pullback seen during the European and US sessions. The USD has lost ground after hitting one-month against a basket of currencies earlier today boosted by safe trading as the first results of the US elections discarded the clear Democrat victory anticipated by the polls.

The initial market volatility eased gradually and the USD accelerated its reversal with equity markets surging and Joe Biden taking the lead against the incumbent Donald Trump in key states.

The CNN has reported Joe Biden’s victory in Wisconsin and has taken the lead in Nevada and Michigan, which opens the door for a tight Democrat victory. The contested election, however, is likely to deliver a split Congress, which will hinder the approval of a large fiscal stimulus package.

On the macroeconomic front, the market has largely ignored the US ADP employment change, which has shown a 365K increase in September, well below the expectations of a 690K increment.

News from the Brexit has failed to offer support to the sterling.  The UK chief negotiator, David Frost has reiterated that both parties are still far apart in some core issues after two weeks of intense negotiations although the talks are expected to continue in London this weekend.

Technical levels to watch