Currently, GBP/USD is trading at 1.2736, down -0.35% on the day, having posted a daily high at 1.2816 and low at 1.2723.
GBP/USD has taken a knock with the appointment of the LSE Professor Silvana Tenreyro to the MPC who is seen as a dove. Cable dropped a quick 60 pips. Meanwhile, it is the start of Brexit negotiations this week. We expect nothing because the UK position is as clear as mud beyond growing signs that the UK wants free trade without being part of the customs union or conceding grounds on border controls, as explained by Kit Juckes, an economist at Societe Generale. "Sterling's probably range-bound. Any rally triggered by ‘soft Brexit' hopes is probably temporary."
"The downside potential will remain limited as long as the price holds above 1.2705, February's high, while spikes beyond 1.2800 will probably attract selling interest, with only an upward acceleration through 1.2820 favouring additional gains ahead," explained Valeria Bednarik, chief analyst at FXStreet. GBP's upside, on the other hand, has the post-election high around 1.2820, with risk to the 50 day MA at 1.2843 and no major resistance ahead of 1.29.
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