GBP/USD: Extra gains look likely above 1.2550 – UOB

Pablo Piovano FXStreet

GBP/USD could advance on a more sustainable fashion once 1.2550 is cleared, suggest UOB Group’s Economist Lee Sue Ann and Markets Strategist Quek Ser Leang.

Key Quotes

24-hour view: “Our view for GBP to drop further was incorrect as it rebounded strongly and retraced more than Tuesday’s entire drop (to a high of 1.2516). Despite the advance, there is no significant increase in momentum and instead of strengthening much further, GBP is more likely to trade sideways in 1.2420/1.2520 range.”

Next 1-3 weeks: “Yesterday (26 Apr, spot at 1.2415), we highlighted that ‘while the downward risk is beginning to build, GBP has to break and stay below 1.2345 before a sustained decline is likely’. We added, ‘the chance of GBP breaking clearly below 1.2345 will increase as long as it stays below 1.2490 in the next few days’. We did not expect the strong bounce that took out our ‘strong resistance’ level of 1.2490 (high of 1.2516). Despite the advance, upward momentum has not improved much. In order to advance in a sustained manner, GBP has to break and stay above 1.2550. The likelihood of GBP breaking clearly above 1.2550 will remain intact as long as it does move below 1.2370. Looking ahead, the next resistance level above 1.2550 is at 1.2665.”

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

AUD/USD flatlines near 0.6965 as less hawkish RBA counters USD weakness

AUD/USD holds steady above a two-week low, trading near 0.6965 in the Asian session on Wednesday as early midterm election results heighten political uncertainty and weigh heavily on the US Dollar. Moreover, reviving safe-haven demand triggers a fresh leg down in US bond yields, offsetting Fed hike bets and exerting additional pressure on the buck. However, a less hawkish RBA caps the Aussie.

USD/JPY declines below 158.00 as USD weakens on midterm election results

USD/JPY comes under heavy selling pressure on Wednesday, dropping below 158.00 during the Asian session as the US Dollar slumps to a one-month low amid heightened political uncertainty after early US midterm vote counts. Moreover, the prospect of gridlock in Washington drives safe-haven flows, triggering a fresh leg down in US bond yields and further weighing on the buck.

Gold reclaims $4,000 and above

Gold manages to regain some composure, leaving behind two consecutive daily pullbacks and reclaiming the area above the key $4,000 mark per troy ounce on Wednesday. The strong decline in the US Dollar, declining US Treasury yields and lower crude oil price all contributes to the yellow metal’s recovery.

Crypto Today: Bitcoin, Ethereum, XRP extend advance as US Dollar slides on Democrats' US midterm victory

Bitcoin trades above $78,000 on Wednesday as risk-on sentiment improves in the broader cryptocurrency market. Ethereum mirrors BTC’s recovery outlook, hovering above $2,300. Ripple similarly exchanges hands above $1.28, marking two consecutive days of gains.

US midterms 2026: Investor Q&A on the Democratic sweep

1. Gridlock replaces the stimulus narrative. A Democratic Congress would constrain Trump's ability to pursue additional fiscal expansion and legislative tax measures. But it cannot simply reverse the president's entire economic agenda. Executive powers, existing legislation and presidential vetoes remain important. 2. AI faces a higher hurdle, not an extinction event.

The 2% inflation target came from a throwaway remark. It now moves trillions

The Federal Reserve's 2% inflation goal grew out of an off-the-cuff remark by a New Zealand politician in 1988. Bond investors still price long-term US debt as if 2% holds, so a change in how the Fed measures inflation would move markets.