GBP/USD remains on the back foot, all eyes on Conservative voting


  • The first round of voting for Tories to select their new leader takes place today.
  • All the 10 candidates need at least 16 votes (5%) to remain on the card.
  • The expected lead of Boris Johnson and demise of a motion to block no-deal Brexit highlights the risk.

While the failure of Labour-led motion to block the chances of no-deal Brexit weakened the Pound (GBP), the GBP/USD pair remains on a back foot around 1.2690 as traders await the first round of voting to decide the new Tory leader while heading into the London open on Thursday.

Even if the ex-London Mayor Boris Johnson is leading the run to become the next British Prime Minister mainly due to his Brexit hardliner image, he needs to get through today’s parliament voting with more than 16 votes in order to remain in the race.

Mr. Johnson recently announced his election propaganda to leave the block by October 31. However, the latest clues have mostly been silent about his stance on dealing with the EU during the time.

The opposition Labour party continues to signal another attempt to block the no-deal Brexit sometime in the near future but the markets give less importance to it.

At the US, the greenback holds its status as the market favorite amid less dovish Fed highlighting its safe-haven demand in times when the trade tussles are in the spotlight.

Given the absence of major data on the economic calendar from both the economies, investors may emphasize political plays to determine near-term trade direction.

In case of the USD, the US-China stalemate continues to flash mixed signals of a trade deal while the weekly initial jobless claims for the period ended on June 07 might soften a bit to 217K from 218K.

Elsewhere, chances are bright that some of the contestants of the UK PM’s race might be off from today and hence giving a clearer picture of the next British leader. Though, Boris Johnson is likely to remain on the top unless any surprises take place, which in turn highlights the chance of a hard Brexit and a weaker British currency given the latest failure of Labor-led motion.

Technical Analysis

The 1.2600 round-figure can offer an intermediate halt prior to shifting market attention to 1.2560 and December 2018 low near 1.2480.

Alternatively, 1.2760 and 1.2865/75 region including April low and 50-day simple moving average (SMA) could keep challenging the buyers.

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

Latest Forex News

Editors’ Picks

EUR/USD: Bearish outside day as Fed tempers aggressive rate cut expectations

Tuesday’s bearish outside day makes today’s close pivotal. Fed officials pushed back on aggressive rate cut calls, pushing the USD higher. An above-forecast US durable goods data could yield a bearish daily close. 

EUR/USD News

GBP/USD offers fewer moves ahead of Carney’s speech

Having reversed from the 50-day SMA, mainly because of renewed Brexit fears and sluggish data from the UK’s CB retail sales survey, the GBP/USD pair trades modestly flat near 1.2685 ahead of the London open.

GBP/USD News

USD/JPY: Bulls back in charge, re-takes 107.50

The less dovish rhetoric from a selection of Fed speakers overnight continues to aid the post-FOMC US dollar recovery, prompting the USD/JPY pair to retest the midpoint of the 107 handle despite negative Asian equities. 

USD/JPY News

Gold: 100-HMA triggers the U-turn towards $1421?

Gold is on a run towards near-term horizontal-resistance following its U-turn from the 100-hour moving average (HMA) ticks it up to $1407.80 ahead of the European open on Wednesday.

Gold News

Conference Board Consumer Confidence: The China syndrome

The index declined to 121.5 in June from April’s revised 131.3. A much more modest drop to 131.2 had been predicted.  “The escalation in trade and tariff tensions earlier this month appears to have shaken consumers’ confidence,” wrote Lynn Franco.

Read more

Majors

Cryptocurrencies

Signatures