• Resurgent USD demand prompts some aggressive selling at higher levels.
• Bullish traders shrug off upbeat UK PMI/Hunt’s positive Brexit comments.
The GBP/USD pair extended its sharp intraday slide and is currently placed at the lower end of its daily trading range, just above mid-1.2600s.
After an initial uptick to 1.2775 area, the pair witnessed a sudden turnaround in sentiment on the first trading day of the New Year and has now lost over 110-pips from session tops amid a goodish pickup in the US Dollar demand.
Despite expectations of a dovish Fed in 2019 and the partial US government shutdown, the greenback regained positive traction and was seen as one of the key factors behind the pair's follow-through retracement from 3-1/2 week tops, levels beyond the 1.2800 handle, set on Monday.
Bearish traders even shrugged off today's upbeat UK manufacturing PMI, coming in at a six-month high level of 54.2 in December, with the USD price dynamics turning out to be an exclusive driver of the pair's momentum through the mid-European trading session.
Even some positive comments by the UK foreign secretary Jeremy Hunt, saying that the UK PM Theresa May will find a way to get Brexit deal through Parliament, did little to ease the bearish pressure or stall the ongoing slide.
Hence, a follow-through weakness, ahead of the Parliament debate on the May's Brexit agreement, set to resume in the week of January 7, and the meaningful vote planned to be held before January 21, now looks a distinct possibility.
Technical levels to watch
GBP/USD
Overview:
Today Last Price: 1.2665
Today Daily change: -95 pips
Today Daily change %: -0.745%
Today Daily Open: 1.276
Trends:
Previous Daily SMA20: 1.2664
Previous Daily SMA50: 1.2784
Previous Daily SMA100: 1.2899
Previous Daily SMA200: 1.3178
Levels:
Previous Daily High: 1.2765
Previous Daily Low: 1.2705
Previous Weekly High: 1.2778
Previous Weekly Low: 1.2616
Previous Monthly High: 1.284
Previous Monthly Low: 1.2477
Previous Daily Fibonacci 38.2%: 1.2742
Previous Daily Fibonacci 61.8%: 1.2728
Previous Daily Pivot Point S1: 1.2722
Previous Daily Pivot Point S2: 1.2683
Previous Daily Pivot Point S3: 1.2662
Previous Daily Pivot Point R1: 1.2782
Previous Daily Pivot Point R2: 1.2803
Previous Daily Pivot Point R3: 1.2842
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.