GBP/USD ends week slightly higher, in the middle of the range


  • Pound receives a modest relief after Johnson’s Brexit proposal, remains pressured. 
  • US Dollar drops amid weak economic data, lower yields. 

The GBP/USD pair ended the week modestly higher and far from the lows. It was about to finish the week hovering around 1.2320/30, flat on Friday after the NFP report. 

Between Brexit and US data 

The Pound managed to remove some of its vulnerability over the week after the Brexit plan presented by UK Prime Minister Boris Johnson received support from Tories. Also, some negotiations and even a Brexit extension are back on the table. Still, uncertainty continues to be the main theme. 

The main focus in the UK will continue to be Brexit negotiations, ahead of the European Union Summit of 17-18 October. "With respect to economic releases next week, we look forward to getting the monthly GDP estimate for August. PMIs continue to suggest the UK is stagnating but the GDP data may be distorted by stockpiling ahead of the Brexit deadline on 31 October (although most data suggest companies have not stockpiled to the same extent so far). We expect GDP was flat in August,” wrote Danske Bank analysts. 

Regarding the Greenback, it finished the week lower after reversing the trend from weekly lows. Weaker-than-expected US data weighed on the US Dollar over the week. On Friday the NFP came in mixed offering relief and signaled the labor market remains solid despite slowing down. 

Economic data is likely to continue to have an impact on Federal Reserve rate cut expectations. Next week the calendar is quiet week regarding economic report. The most important will be inflation on Thursday. 

A critical event will be the FOMC meeting minutes. Analysts at Danske point out that at the September meeting the Fed cut its target range by 25bp to 1.75-2.00% as expected, however, it did not precommit to more easing. “We had a clear division in the committee and the biggest number of dissenters since 2016 so it will be interesting to see if the minutes will shed light on the different stances within the Fed.” Also more headlines regarding US trade policy are expected. 

GBP/USD outlook levels

Yohay Elam, analysts at FXStreet points out the picture in the GBP/USD pair has become more bearish. “GBP/USD has lost its uptrend momentum on the daily chart but managed to hold above the 50-day Simple Moving Average (SMA). The currency pair trades below the 100 and 200 SMAs. It is capped by downtrend resistance, which has recently formed.”

GBP/USD

Overview
Today last price 1.233
Today Daily Change -0.0001
Today Daily Change % -0.01
Today daily open 1.2331
 
Trends
Daily SMA20 1.2383
Daily SMA50 1.2253
Daily SMA100 1.2433
Daily SMA200 1.2725
 
Levels
Previous Daily High 1.2414
Previous Daily Low 1.2266
Previous Weekly High 1.2504
Previous Weekly Low 1.2271
Previous Monthly High 1.2583
Previous Monthly Low 1.1958
Daily Fibonacci 38.2% 1.2357
Daily Fibonacci 61.8% 1.2322
Daily Pivot Point S1 1.226
Daily Pivot Point S2 1.2189
Daily Pivot Point S3 1.2112
Daily Pivot Point R1 1.2408
Daily Pivot Point R2 1.2485
Daily Pivot Point R3 1.2556

 

 

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