GBP/USD inching towards 1.39, BOE's Haldane to set the tone later

The Sterling is still trying to correct a slowly-sinking ship.
The BOE's Haldane to speak later today; a bullish tone is expected.

Joshua Gibson FXStreet

The GBP/USD pair is middling ahead of the London markets, reaching an overnight session high of 1.3862 before giving up Asia's gains to trade back near 1.3845.

The Sterling has drifted lower against the US Dollar for most of February, and the GBP is geared up to put an end to that with the pair bouncing upwards recently after digging in its heels from the swing low of 1.3712 on March 1st. Sterling data is spread thin today, featuring a low-tier 30-year bond auction taking place and a potentially market-moving speech from the Bank of England's (BOE) Chief Economist, Andy Haldane. Haldane will be speaking at the Royal Society for the Encouragement of Arts, Manufactures, and Commerce beginning at 18:15 GMT, and although it's highly unlikely that Haldane will be providing anything new in the way of forward guidance for Sterling traders, a hawkish tone and upbeat outlook from the Monetary Policy Committee member will give the Sterling the boost it needs to start climbing back up the charts.

Fears about Brexit uncertainty were assuaged and then promptly replaced with new ones following the UK Prime Minister Theresa May's speech last Friday, where she addressed the lack of clarity for business operators and citizens following Brexit. PM May has shown a willingness to meet European Union (EU) leaders in Brussels at the halfway point on many issues, but highlighted that the UK economy will eventually leave the safety of the EU to seek better trade deals, though the Prime Minister has agreed to sacrifice some of the UK's sovereignty in exchange for mutually-exclusive trade deals between the UK and the EU during the ongoing Brexit process which begins next March.

GBP/USD Technicals

The pair is currently trading upwards into resistance from the 34-day EMA at 1.3875 and despite February's wafting decline, the Sterling is still trading well above the 200-day SMA against the US Dollar, though the H4 charts tell a cautionary tale with the latest swing upwards from 1.3712 still representing a lower low in the overall pattern. Intraday support is currently coming from the 1.3800 major handle and 1.3755 below, while resistance is priced in from 1.3877 to 1.39360.

Author

Joshua Gibson

FXStreet

Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.

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