GBP/USD pops to daily highs near 1.2960… on Brexit rumours, of course

  • Cable shoots higher and clinches tops near 1.2960.
  • UK CPI came in below expectations during January.
  • Rumours on probable extension of Article 50 in place.

The demand for the Sterling is now picking up extra pace and is lifting GBP/USD to fresh 3-day tops in the boundaries of 1.2960.

GBP/USD shrugs off CPI results

Cable moved higher in response to market chatter considering once again the likeliness that the key Article 50 could extended, briefly testing the key 200-hour SMA around 1.2960.

However, it is worth recalling that Brexit Secretary S.Barclay has already talked down that potential scenario, contradicting Tuesday’s comments from May’s chief negotiator O.Robbins.

This way, GBP managed to quickly leave behind disappointing inflation figures for the month of January published earlier in the European morning, re-focusing instead on the psychological 1.3000 the figure.

What to look for around GBP

The British Pound is expected to remain under increasing pressure as we get closer to the March 29 deadline and there is still not a hint of a solution to the EU-UK divorce, where the Irish backstop stays in centre stage and a ‘hard Brexit’ scenario is not totally ruled out. Extra weakness hitting the Sterling also comes from deteriorated fundamentals in the UK, the persistent downtrend in inflation as well as lower growth forecasts, as per the latest BoE event.

GBP/USD levels to consider

As of writing, the pair is gaining 0.32% at 1.2931 and a break above 1.2960 (200-hour SMA) will open the door to 1.3000 (high Jan.17) and then 1.3019 (200-day SMA). On the flip side, the next down barrier lines up at 1.2888 (100-day SMA) seconded by 1.2832 (low Jan.12) and finally 1.2812 (55-day SMA).

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.

Feed news

EUR/USD slides on USD strength, weak German data

EUR/USD is trading below 1.1350. The German IFO Business Climate slightly missed expectations with 98.5 points. The USD is gaining ground despite progress in US-Chinese talks.


GBP/USD recaptures 1.3000 amid Brexit uncertainty, dollar swings

GBP/USD is trading above 1.3000 once again, as the USD loses ground now. Reports about a potential extension of Brexit are circulating but no progress has been made. Trump meets China's Vice PM Liu later.