- GBP/USD trades 0.44% higher as Brexit news boosts the price.
- Next stop the psychological 1.30 level which has been tricky in the past.
Fundamental backdrop
Cable has been moving higher on Wednesday as the latest headlines out of the Brexit negotiations are positive. It was early on in the EU session when EU's Cheif Brexit Negotiator Barnier lifted hopes of Brexit deal amid new 'buzz' in talks (reported by the Express). This is in stark contrast to what usually happens after Brexit talks as there is normally a flurry of negative comments.
It was then the Bank of England's Cheif Economist's (Andy Haldane) turn to rock the pound as he stated that none of the conditions for negative rates had been met. He went on to comment that any decision on the policy would depend on cost-benefit analysis and that this could potentially take months. Lastly, Haldane went on to say that the BoE is committed to keeping borrowing costs at low levels and the economy has recovered faster than anyone had expected.
GBP/USD 1-hour chart
The hourly chart below shows the extent of the pound rally. The pair looks set to hit 1.30 and there is a firm-level marked in blue in very close proximity. The level has been tested seven times in just two months and its fair to say there could be a reaction there.
The indicators have now turned positive as the MACD histogram is green and the signal lines are above zero. The Relative Strength Index is above 50 and looks like it could be heading to the overbought zone.
Away from the resistance level mentioned above. There is a stronger one marked by the red rectangle. This zone confluences with the 61.% Fibonacci retracement level and might by sticky should the price get that high. If there is more positive Brexit news to come by the end of the week it would be hard to rule that out.
-637370865881354403.png)
Additional levels
All information and content on this website, from this website or from FX daily ltd. should be viewed as educational only. Although the author, FX daily ltd. and its contributors believe the information and contents to be accurate, we neither guarantee their accuracy nor assume any liability for errors. The concepts and methods introduced should be used to stimulate intelligent trading decisions. Any mention of profits should be considered hypothetical and may not reflect slippage, liquidity and fees in live trading. Unless otherwise stated, all illustrations are made with the benefit of hindsight. There is risk of loss as well as profit in trading. It should not be presumed that the methods presented on this website or from material obtained from this website in any manner will be profitable or that they will not result in losses. Past performance is not a guarantee of future results. It is the responsibility of each trader to determine their own financial suitability. FX daily ltd. cannot be held responsible for any direct or indirect loss incurred by applying any of the information obtained here. Futures, forex, equities and options trading contains substantial risk, is not for every trader, and only risk capital should be used. Any form of trading, including forex, options, hedging and spreads, contains risk. Past performance is not indicative of future FX daily ltd. are not Registered Financial Investment Advisors, securities brokers-dealers or brokers of the U.S. Securities and Exchange Commission or with any state securities regulatory authority OR UK FCA. We recommend consulting with a registered investment advisor, broker-dealer, and/or financial advisor. If you choose to invest, with or without seeking advice, then any consequences resulting from your investments are your sole responsibility FX daily ltd. does not assume responsibility for any profits or losses in any stocks, options, futures or trading strategy mentioned on the website, newsletter, online trading room or trading classes. All information should be taken as educational purposes only.
Recommended content
Editors’ Picks
AUD/USD remained bid above 0.6500
AUD/USD extended further its bullish performance, advancing for the fourth session in a row on Thursday, although a sustainable breakout of the key 200-day SMA at 0.6526 still remain elusive.
EUR/USD faces a minor resistance near at 1.0750
EUR/USD quickly left behind Wednesday’s small downtick and resumed its uptrend north of 1.0700 the figure, always on the back of the persistent sell-off in the US Dollar ahead of key PCE data on Friday.
Gold holds around $2,330 after dismal US data
Gold fell below $2,320 in the early American session as US yields shot higher after the data showed a significant increase in the US GDP price deflator in Q1. With safe-haven flows dominating the markets, however, XAU/USD reversed its direction and rose above $2,340.
Bitcoin price continues to get rejected from $65K resistance as SEC delays decision on spot BTC ETF options
Bitcoin (BTC) price has markets in disarray, provoking a broader market crash as it slumped to the $62,000 range on Thursday. Meanwhile, reverberations from spot BTC exchange-traded funds (ETFs) continue to influence the market.
US economy: slower growth with stronger inflation
The dollar strengthened, and stocks fell after statistical data from the US. The focus was on the preliminary estimate of GDP for the first quarter. Annualised quarterly growth came in at just 1.6%, down from the 2.5% and 3.4% previously forecast.