GBP/USD: headed back to 1.50?

GBP/USD: looking in at Jan 25th post-Brexit referendum highs, where next?
GBP/USD: Syria threat shrugged off, BoE in focus.

Ross J Burland FXStreet

GBP/USD was handed over to the US open up +0.45% in the European session after rising from 1.4238 to a high of 1.4313. Currently, GBP/USD is trading at 1.4329, up 0.64% on the day, having posted a daily high at 1.4339 and low at 1.4232.

British Prime Minister Theresa May has been addressing the UK parliament

The British Prime Minister Theresa May has been addressing the UK parliament after joining France and the US in airstrikes against Syria in a military operation that followed allegations of a chemical weapons attack in the town of Douma. Russia has said that if there is another Western attack on Syria, there will be 'global 'chaos'.

Besides the geopolitical uncertainties, the main focus stays with the Central Banks and the potential for a rate hike from the BoE as soon as next month. This sentiment is giving the pound the edge while the DXY is weaker in its own right with broad-based dollar weakness and stronger commodities to start the week in European and US markets. There is also so M&E news in the background underpinning the pound with Shire selling its oncology business to Servier for $2.4bln. Also, with the most recent Brexit news more positive, cable has moved in on the post-Brexit referendum day high of 1.4346 with the latest high being 1.4337 so far.

GBP/USD levels

Bulls need to keep above the 200-W SMA 1.4245 that guards the Jan 2018 high of 1.4346. The post-Brexit highs by 1.5022 come thereafter on the very wide. "The GBP undertone is technically constructive and we think a push through the low 1.43s to a new cycle high will facilitate a push on to the mid 1.44 area fairly quickly. Support is 1.4230," analysts at Scotiabank noted. The psychological target comes as the 1.40 handle that guards 1.3960 and the four-month uptrend line at 1.3844.

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

AUD/USD slides as US yields jump before pivotal CPI

The Australian Dollar ended Thursday’s session with a 0.80% loss against the US Dollar after US producer inflation exceeded estimates, triggering pricing for a more hawkish Federal Reserve. The AUD/USD trades at 0.7159 after reaching a peak of 0.7223.

USD/JPY consolidates around 153.50 as bears turn cautious ahead of US inflation

USD/JPY stabilizes above 153.50 during the Asian session on Thursday, but remains near a seven-month low set earlier this week as hawkish BoJ repricing continues to underpin the Japanese Yen. Meanwhile, rising September Fed rate-hike bets and escalating US-Iran tensions help ease US Dollar selling pressure, offering some support to the currency pair ahead of US inflation figures.

Gold remains weak, retargets $4,350

Gold keeps the choppy price action on Thursday, now slipping back toward the $4,350 region per troy ounce amid the robust bounce in the US Dollar as well as rising US Treasury yields across the curve, particularly following US Producer Prices and ahead of Friday’s more relevant US CPI data.

Bitcoin holds steady on positive ETF flows despite short-term holders cashing in

Bitcoin's exchange-traded funds (ETF) demand regime has notably shifted, with 30-day net inflows reaching $21.9 billion, according to a Thursday post by CryptoQuant. The data suggests that the average Bitcoin held through spot ETFs is now in profit, with the realized price of the ETF cohort standing at roughly $72,000 to $73,000.

ECB recap: A hawkish hike despite downside growth risks

The European Central Bank (ECB) increased the Deposit Facility Rate to 2.50%, the Refinancing Rate to 2.65% and the Marginal Lending Facility to 2.90%, effective from September 16. The decision was accompanied by a clear warning that the outlook remains highly uncertain, with risks tilted to the upside for inflation and to the downside for growth.

Venezuela’s 65-billion-barrel Oil deal could reshape America’s inflation fight

The United States (US) has secured unprecedented access to part of Venezuela’s vast Oil reserves. The timing is particularly significant as the war with Iran is disrupting Middle Eastern supplies, keeping energy prices elevated and reviving concerns about inflation.