GBP/USD holds on to recovery gains ahead of UK Manufacturing PMI, US NFP

GBP/USD takes the bids amid UK political optimism, greenback weakness.
US-China trade story keeps risk sentiment dwindled ahead of the key data.
Fedspeak and the US ISM Manufacturing PMI add to the catalysts.

Anil Panchal FXStreet

GBP/USD keeps its latest recovery mode active as it takes the bids to 1.2960 while heading into the London open on Friday.

The pair has recently been favored by an improvement in odds that favors the United Kingdom’s (UK) Prime Minister (PM) Boris Johnson’s victory in the upcoming snap general election. Recently adding to the Tory side happiness was the news that the Brexit party is pulling out of many polls, which in turn helps PM Johnson.

Polls from Britain Elects show Tories in the lead with 36.1% – up 1% since October 25 – while all other UK-wide parties are losing ground. The opposition Labour Party, led by Jeremy Corbyn, is down 0.4% to 24.9%. That puts the gap at over 12%.

Not only the UK residents but the United States (US) President Donald Trump also openly criticized the opposition Labour Party leader Jeremy Corbyn while saying that he will be “so bad” for Britain.

On the other hand, the US Dollar (USD) keeps its downwards trajectory intact as pessimism surrounding the US-China trade pessimism increases and the same has been well pointed out by the Chinese diplomats at the end of a key meeting.

Markets are likely to wait for the October month Markit Manufacturing Purchasing Managers Index (PMI) from the UK, followed by the US employment data, ISM Manufacturing PMI and comments from the key Federal Reserve (Fed) policymakers.

Expectations favor a downbeat print of the UK manufacturing gauge to confront forecast of recovery in the US manufacturing data and mixed employment statistics with likely weak Nonfarm Payrolls.

Technical Analysis

Prices need a sustained break above 1.3000, also crossing the October month high near 1.3015, to rise towards May month top surrounding 1.3180, failing to which can recall the June top near 1.2780.

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

AUD/USD climbs toward 0.7000 after strong China data dump

AUD/USD attracts follow-through buyers for the second straight day on Monday, extending last week's recovery toward 0.7000 in Monday's Asian trading. Strong Chniese Q3 GDP and activity data for September strengthen the pair's advance, following RBA Assistant Governor Chris Kent's hawkish remarks.

USD/JPY struggles near 158.00 amid hawkish BoJ, subdued USD

USD/JPY remains defensive near 158.00 in the Asian session on Monday, as the US Dollar remains depressed near a two-week low amid the recent decline in US bond yields. Furthermore, looming intervention risks underpin the Japanese Yen and weigh on the pair amid BoJ Governor Kazuo Ueda's hawkish remarks. However, Fed rate-hike bets and geopolitical uncertainties could limit USD losses and the major.

Gold bulls hesitant below $4,200 as Fed risks and firmer USD cap intraday gains

Gold struggles to capitalize on modest intraday gains and remains below the $4,200 mark, well within a three-week-old trading range. US Federal Reserve Chair Kevin Warsh’s unwillingness to offer fresh cues on further policy moves forced investors to price out the possibility of policy tightening later this month. Moreover, the recent sharp pullback in US government bond yields from multi-year highs, which dragged the US Dollar to a two-week low on Friday, acts as a tailwind for bullion.

Pi Network: Weak momentum and waning demand reinforce downside bias

Pi Network edges lower, risking a bearish conclusion to its short-term consolidation above the $0.0774 horizontal support. A steady decline in the notional value of active PI futures contracts and the weekly spot trading volume suggests reduced retail demand. The PI token risks a retest of its record low around $0.0704 as bearish momentum remains dominant on the daily chart.

Canada CPI expected to show a pick-up in inflation in September

Canada’s September CPI figures will be the focus of attention on Monday. Indeed, Statistics Canada data will provide markets with an update on price pressures ahead of the BoC’s October 28 gathering, when officials are expected to keep the interest rate steady at 2.25%, broadly in line with analyst consensus.

Everyone's dumping Gold after hot US inflation. Here's why $4,100 could be a floor, not a cliff

Gold (XAU/USD) is recovering from a sharp sell-off triggered by hotter-than-expected United States (US) inflation data released on Wednesday. The precious metal briefly plunged toward $4,073 as investors increased their bets on further Federal Reserve (Fed) interest rate hikes before recovering as US Treasury yields and the US Dollar (USD) reversed their initial gains.