GBP/USD recovering from early risk slump

Markets are keeping one foot in safe havens as the US launches another volley of China tariffs.
With the UK calendar empty until Wednesday, Brexit is the meaningful data point for traders this week.

Joshua Gibson FXStreet

The GBP/USD is popping into 1.3160 ahead of London's market open for Tuesday after further tariffs in the US-China trade war are set to come into effect on September 24th.

Market sentiment took a step lower in Tuesday's early trading after the US announced $200 billion in tariffs against China, and broader risk sentiment has struck a cautious tone as traders brace for reactions from China.

Tuesday marks the second day in a row of little UK economic data on the calendar, and traders are looking towards Wednesday's CPI reading at 08:30 GMT, where markets are forecasting a tick lower from 1.9% to 1.8% for the y/y figure into August.

Brexit continues to be the headliner of note for the GBP markets; hardline Brexiteers within the UK's own government are promising to automatically vote down any deal that Prime Minister May reaches with the EU, just as Michel Barnier, the EU's lead Brexit negotiator, finally looks set to begin working on making a workable agreement with PM May.

GBP/USD levels to watch

The Sterling is leaning into the bullish camp, buoyed by Brexit hopes, and as FXStreet's own Valeria Bednarik noted, "the GBP/USD pair broke above its previous 6-week high but held a few pips below the 1.3170 resistance, the 50% retracement of the 2016/18 rally. The 4 hours chart shows that a bullish 20 SMA continues providing intraday dynamic support, currently at 1.3090, also that the RSI indicator lost directional strength after reaching overbought levels, and that the Momentum turns lower, rather indicating pausing buying interest than an upcoming decline, as the price remains at daily highs. Large stops are suspected above the mentioned long-term Fibonacci resistance and could result in a steeper advance if they got triggered. 1.3212, July 26th daily high, is the next possible bullish target."

Support levels: 1.3125 1.3090 1.3045

Resistance levels: 1.3170 1.3210 1.3240

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.

AUD/USD holds above 0.7050 as hot CPI boosts RBA hike bets

The AUD/USD drifts higher by 0.40% on Wednesday after the Federal Reserve held rates unchanged, while Fed Chair Kevin Warsh hinted that "officials had made clear our readiness to act as circumstances require, and we have shown our willingness to act.” The AUD/USD trades at 0.7053.

USD/JPY: Japanese Yen recovers modestly as Warsh reaffirms Fed’s 2% target

The Japanese Yen recovers some ground against the US Dollar on Wednesday after Federal Reserve Chair Kevin Warsh crossed the wires, saying the FOMC will deliver price stability and is committed to the 2% inflation goal. USD/JPY trades at 157.89, down 0.02%.

Gold declines to near $4,050 after Fed rate hold, markets await US PCE data

Gold price edges lower to around $4,050 during the early Asian session on Thursday. Markets assess comments from Federal Reserve Chair Kevin Warsh after the US central bank left benchmark interest rates unchanged at its October policy meeting.

Bitcoin volatility falls to 2023 lows, Glassnode says

Bitcoin climbed above $81,000 on Wednesday as the Federal Reserve (Fed) kept interest rates unchanged at 3.75%–4.00% in a 10–2 vote. The decision came as the top crypto's realized volatility fell to levels last seen in the summer of 2023.

Fed's recap: A cautious hold with a clear warning on inflation

The Federal Reserve (Fed) held its policy rate steady at 3.75%-4.00%, but it wasn’t a unanimous decision. Among two officials who wanted a 25-basis-point hike were Lisa Cook and Beth Hammack, while Chair Kevin Warsh said the Fed would use the coming flow of information to decide whether further action is needed. The statement presented a resilient economy.

Anthropic pledged $270 billion to Amazon, Google, and Microsoft. Here's who actually gets paid

Anthropic owes Amazon, Google, and Microsoft at least $269.4 billion for computing power, even if it uses less. All three sell its models and handle its billing, and Amazon and Google own stakes and lend it money, so they get paid regardless of how the IPO goes. The Dario Amodei-led Anthropic filed its initial public offering (IPO) on Monday, seeking a listing on the Nasdaq under the ticker ANT.