GBP/USD refreshes session lows, back below 1.2500 handle

News of potential ministerial resignations exerts some pressure in the last hour.
Tempered Fed rate cut bets underpins the USD and added to the selling bias.

Haresh Menghani FXStreet

The GBP/USD pair finally broke down of its Asian session consolidation phase and dropped to fresh session lows, around the 1.2475 region in the last hour.

The latest leg of a sudden drop of over 35-pips, dragging the pair farther below the key 1.2500 psychological mark came in reaction to the UK political headlines, suggesting that the ministerial resignations could begin later this Monday.

It is worth reporting that UK chancellor of the exchequers Phillip Hammond, along with the Secretary of State for Justice and Lord Chancellor David Guake stand ready to resign if Boris Johnson - the frontrunner, becomes the next British PM.

On the other hand, the US Dollar remains supported by St. Louis Fed President James Bullard's comments on Friday, saying that a 25 bps rate cut seems appropriate as the current US economic condition doesn't warrant a larger cut.

The downside, however, remained limited, at least for the time being, as investors still seemed reluctant to place any aggressive bets ahead of the Tory leadership voting results, expected to be announced on Tuesday, and absent relevant economic data.

Hence, it would be prudent to wait for a strong follow-through selling before traders start positioning for the resumption of the pair's well-established bearish trend and a possible move back towards challenging 27-month lows set last Wednesday.

Technical levels to watch

GBP/USD

Overview
Today last price	1.248
Today Daily Change	-0.0023
Today Daily Change %	-0.18
Today daily open	1.2503

Trends
Daily SMA20	1.2569
Daily SMA50	1.2646
Daily SMA100	1.2868
Daily SMA200	1.2875

Levels
Previous Daily High	1.2557
Previous Daily Low	1.2476
Previous Weekly High	1.2579
Previous Weekly Low	1.2382
Previous Monthly High	1.2784
Previous Monthly Low	1.2506
Daily Fibonacci 38.2%	1.2507
Daily Fibonacci 61.8%	1.2526
Daily Pivot Point S1	1.2467
Daily Pivot Point S2	1.2431
Daily Pivot Point S3	1.2387
Daily Pivot Point R1	1.2548
Daily Pivot Point R2	1.2593
Daily Pivot Point R3	1.2629

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

AUD/USD sticks to positive bias above 0.7100; lacks bullish conviction

AUD/USD trades with a positive bias for the second straight day, holding above 0.7100 in the Asian session on Friday as softer US bond yields keep US Dollar bulls on the back foot. Furthermore, hawkish RBA Governor Bullock's comments boost rate hike bets and support the Aussie. However, the Fed's hawkish outlook, along with geopolitical uncertainties, limits USD losses and caps the pair.

USD/JPY approaches 158.00 as Japanese Yen resumes decline

USD/JPY is resuming its upside in the European session on Friday, refreshing two-week highs and nearing 158.00. The Japanese Yen extends losses, despite the Bank of Japan's (BoJ) expected rate hike to 1.25% and hawkish Governor Ueda's comments, as two surprise dissents against the rate hike weigh on it.

Gold keeps the bid tone in place; still below $4,400

Gold adds to the optimism seen in the second half of the week, trading with decent gains just below the $4,400 mark per troy ounce on Friday. The precious metal’s advance finds traction in declining crude oil prices and fresh selling pressure on the US Dollar.

Why altcoin season isn't coming back — and what stole its capital

If, after two years of being frozen in ice, Katara and Sokka woke you up to the crypto market, it would seem like 100 years have passed. With Bitcoin soaring to record highs just over a year ago, everyone expected a routine altcoin season, where investors take profits from the top crypto to chase higher returns in altcoins.

BoJ Recap: Not as hawkish as expected

The BoJ raised its short-term interest-rate target to 1.25% from 1.00% in a 7-2 vote, marking another step in the normalisation of monetary policy and widely matching what everyone has been expecting for weeks. Governor Kazuo Ueda said the policy phase had changed.

BoJ Recap: Not as hawkish as expected

The Bank of Japan (BoJ) raised its short-term interest-rate target to 1.25% from 1.00% in a 7-2 vote, marking another step in the normalisation of monetary policy and widely matching what everyone has been expecting for weeks.