GBP/USD eyes daily lows after Johnson’s resignation

Pound drops across the board after Jo Johnson resigns as transport minister.
GBP/USD eyes daily lows, back into negative territory for the week.

Matías Salord FXStreet

The GBP/USD pair spiked to 1.3055 but turned to the downside and accelerated the decline toward daily lows following the resignation of Jo Johnson, Transport minister, brother of Boris Johnson. He quit over Brexit and weakened the pound.

Cable dropped to 1.3010, approaching the 1.3000 area and daily lows. Earlier today, GBP/USD bottomed at 1.2987, the lowest level since Monday. The recovery from the lows was short-lived and it was back under pressure. While GPB/USD eyes daily lows, EUR/GBP printed a fresh daily high at 0.8725.

“Sign of a Brexit deal completion is expected to support Sterling while Brexit deal negative news weighs on its value. Although a great set of the UK data is scheduled for the next week with inflation and wages in the UK rising, with Brexit deal nowhere at sight Sterling is likely to remain heavy”, said Mario Blascak, FXStreet's Editor-in-Chief.

Levels to watch

GBP/USD dropped sharply during the last two days, erasing weekly gains. The price fell back below the 20-week moving average, ending far from the weekly top, a signal that could anticipate further losses for the beginning of next week.

The daily chart shows a key support at the 20-day moving average at 1.2985. Below that level attention would turn to 1.2940 and then 1.2900. If GBP/USD managed to hold above 1.2985 it could correct higher. Resistance levels are seen at 1.3070 and 1.3130. A daily close above 1.3200 would signal more gained ahead.

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.

EUR/USD challenges 1.1800, two-week lows

EUR/USD remains on the defensive, extending its leg lower to the vicinity of the 1.1800 region, or two-week lows, on Tuesday. The move lower comes as the US Dollar gathers further traction ahead of key US data releases, inclusing the FOMC Minutes, on Wednesday.

GBP/USD looks weaker near 1.3500

GBP/USD adds to Monday’s pessimism and puts the 1.3500 support to the test on Tuesday. Cable’s marked pullback comes in response to extra gains in the Greenback while disappointing UK jobs data also collaborate with the offered bias around the British Pound.

Gold loses further momentum, approaches $4,800

Gold recedes to fresh two-week troughs around the $4,800 region per troy ounce on Tuesday. The precious metal builds on Monday’s downtick following a marked rebound in the US Dollar and mixed US Treasury yields across the board.

Crypto Today: Bitcoin, Ethereum, XRP upside looks limited amid deteriorating retail demand

The cryptocurrency market extends weakness with major coins including Bitcoin (BTC), Ethereum (ETH) and Ripple (XRP) trading in sideways price action at the time of writing on Tuesday.

UK jobs market weakens, bolstering rate cut hopes

In the UK, the latest jobs report made for difficult reading. Nonetheless, this represents yet another reminder for the Bank of England that they need to act swiftly given the collapse in inflation expected over the coming months.

Ripple slides to $1.45 as downside risks surge

Ripple edges lower at the time of writing on Tuesday, from the daily open of $1.48, as headwinds persist across the crypto market. A short-term support is emerging at $1.45, but a buildup of bearish positions could further weaken the derivatives market and prolong the correction.