GBP/USD fails to hold above 1.2300 amid UK’s coronavirus woes, Brexit pessimism

GBP/USD remains mildly positive near the highest in nine days, pulls back recently.
Coronavirus cases in the UK surge, the US dethrones China as the most infected nation.
The EU-UK Brexit talks stalled, UK PM Johnson accused to put Brexit over breathing.
US House votes on the COVID-19 bill, virus updates become the key to watch.

Anil Panchal FXStreet

While joining the chorus to cheer the US dollar weakness, GBP/USD pierces 1.2300, currently up 0.50% around 1.2265, ahead of the London open on Friday. In doing so, the Cable takes cluesa from the coronavirus (COVID-19) outbreak at home as well as Brexit pessimism. Moving on, traders await the US House votes on the COVID-19 Relief Bill for near-term direction.

The US toppled China with more than 81,000 virus cases whereas the BBC cites the highest single-day increase in the UK’s death toll, by 103 to 578, on Thursday.

Elsewhere, the Guardian cited deep differences between the UK and EU over the Brexit talks that are already in the deep freeze for now while the Mirror said that the UK won't take part in EU drive for ventilators because of Brexit.

The Bank of England (BOE) failed to offer any fireworks due to a lack of ammunition while disappointing UK Retail Sales, to 0.0% from 0.8% YoY forecast, also couldn’t recall the bears.

On the other hand, the US dollar registered broad weakness as the markets’ weighed multiple concerns ranging from downbeat employment data to the outbreak in the US.

The risk-tone remains mildly positive with the US 10-year treasury yields being above 0.80% and most Asian stocks flashing the gains.

While the uncertainty over the House voting on the key bill is likely to keep the pair on the front-foot a likely passage could trigger the pair’s pullback on the news. As a result, traders will keep eyes on the macros for fresh direction while the US Michigan Consumer Sentiment Index could offer intermediate direction.

Technical analysis

Only if the pair slips below 10-day SMA level of 1.1870, it can recall the sellers else 1.2365, comprising 21-day SMA, flashes on the bull’s radar.

Additional important levels

Overview
Today last price	1.2264
Today Daily Change	58 pips
Today Daily Change %	0.48%
Today daily open	1.2206

Trends
Daily SMA20	1.237
Daily SMA50	1.2749
Daily SMA100	1.289
Daily SMA200	1.2671

Levels
Previous Daily High	1.223
Previous Daily Low	1.1778
Previous Weekly High	1.24
Previous Weekly Low	1.1412
Previous Monthly High	1.3204
Previous Monthly Low	1.2726
Daily Fibonacci 38.2%	1.2057
Daily Fibonacci 61.8%	1.195
Daily Pivot Point S1	1.1912
Daily Pivot Point S2	1.1619
Daily Pivot Point S3	1.146
Daily Pivot Point R1	1.2365
Daily Pivot Point R2	1.2523
Daily Pivot Point R3	1.2817

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 consolidates above 0.7200 after hot Chinese CPI data

AUD/USD is extending its consolidative price action above 0.7200 during the Asian session on Wednesday, uninspired by hot Chinese CPI and PPI data. Meanwhile, rising RBA rate-hike bets act as a tailwind for the Aussie amid Yen-inspired US Dollar weakness. Traders await the release of US inflation figures later in the week for fresh impetus.

USD/JPY stays weak near 153.50 amid aggressive BoJ hike bets

USD/JPY attracts fresh sellers in the Asian session on Wednesday as the strong Reuters Tankan business survey adds to the case for continued BoJ policy normalisation and boosts the Japanese Yen. This, along with a broadly weaker US Dollar, keeps the pair close to a nearly seven-month low set on Tuesday.

Gold rebounds from $4,350; will it last?

Gold is rebounding from a one-week low near $4,350 in the Asian session on Wednesday. The US Dollar, however, struggles to lure buyers amid a rallying Yen, supporting the commodity as traders await the key US inflation data for a fresh impetus. However, the rebound could be short-lived amid expectations of a Fed rate hike this month.

Bitcoin takes a breather, Ethereum and XRP maintain bullish footing

Bitcoin (BTC), Ethereum (ETH) and Ripple (XRP) are trading with a broadly constructive tone on Wednesday despite BTC's mild pullback over the past two days. The Crypto King holds above $78,000; ETH and XRP remain strong above key Exponential Moving Averages (EMAs), keeping their upside prospects intact.

Gold and stocks: What eight midterm elections did

I went back through every midterm election since 1994 and asked one question of each: when did the stock market make its low for the year, before the vote or after it? In seven of the eight cycles, the low came before the election. In six of the eight, it came between mid-June and mid-October, which is to say in the exact window that the "they won't let it fall" argument says is protected.

Diesel’s record $100 warning: The oil shock hiding in plain sight

The Oil market may look calmer than it did a few months ago, but diesel is sending a very different message. The US diesel crack spread, the premium of ultra-low sulphur diesel futures over WTI, recently surged above $100 per barrel for the first time, reaching an intraday record of just over $102.00.