GBP/USD spikes almost 200 pips, fat finger?

Ivan Delgado Independent Analyst

GBP/USD popped up aggressively from 1.4470 session highs all the way towards 1.4660, surpassing by almost 80 pips last Friday's US NFP-induced highs, with news agencies, including ours, not finding a single catalyst that may have been behind the move, therefore speculation is on the rise that a fat finger could be what caused such an 'out of whack' reaction in the Sterling considering the absence of news.

Assumption of fat finger = selling opportunity?

Should no fresh news hit the wires about a potential catalyst behind the move (by now some news agencies such as Blomberg or Reuters should have come up with a possible trigger), the spike might be assumed to have been an error (fat finger), and as reported in our prior article, may represent a genuine selling opportunity for some players given the recent UK refendum polls, which have recently shifted towards the Brexit camp.

Looking at what's coming next for the Pound, Valeria Bednarik, Chief Analyst at FXStreet, writes: "There won't be relevant macroeconomic releases in the UK until next Wednesday, when the kingdom will publish is April production data. In the meantime, market players will trade accordingly to Brexit risks..."

GBP/USD technicals

Technically, and ignoring the spike seen in Asia, Valeria notes: "According to the 4 hours chart, the downward risk is limited at this point, as the price is holding above its 20 SMA (now adjusted higher), whilst the technical indicators have turned modestly lower within neutral territory. A downward extension below the mentioned daily low, however, can see the decline extending down to the 1.4250 region, a strong static support area."

1 Week
1 Month
1 Quarter

1 Week

Avg Forecast 1.4510

44% Bullish
44% Bearish
11% Sideways

Bias Bullish

1 Month

Avg Forecast 1.4252

11% Bullish
84% Bearish
5% Sideways

Bias Bearish

1 Quarter

Avg Forecast 1.4462

37% Bullish
53% Bearish
11% Sideways

Bias Bearish

Author

Ivan Delgado

Independent Analyst

Established in the Asian continent since 2009, Ivan studied a degree in Business at the University Pompeu Fabra (Barcelona), while also earning a postgraduate degree in Business Administration.

EUR/USD flirts with daily highs, retargets 1.1900

EUR/USD regains upside traction, returning to the 1.1880 zone and refocusing its attention to the key 1.1900 barrier. The pair’s slight gains comes against the backdrop of a humble decline in the US Dollar as investors continue to assess the latest US CPI readings and the potential Fed’s rate path.

GBP/USD remains well bid around 1.3650

GBP/USD maintains its upside momentum in place, hovering around daily highs near 1.3650 and setting aside part of the recent three-day drop. Cable’s improved sentiment comes on the back of the Greenback’s irresolute price action, while recent hawkish comments from the BoE’s Pill also collaborate with the uptick.

Gold holds above $5,000 as bears seem hesitant amid Fed rate cut bets

Gold edges lower at the start of a new week, though it defends the $5,000 psychological mark through the Asian session. The underlying bullish sentiment is seen acting as a headwind for the bullion. However, bets for more rate cuts by the Fed, bolstered by Friday's softer US CPI, keep the US Dollar bulls on the defensive and continue to support the non-yielding yellow metal as the focus now shifts to FOMC Minutes on Wednesday.

Week ahead: Data blitz, Fed Minutes and RBNZ decision in the spotlight

The US jobs report for January, which was delayed slightly, didn’t do the dovish Fed bets any favours, as expectations of a soft print did not materialize, confounding the raft of weak job indicators seen in the prior week.

Global inflation watch: Signs of cooling services inflation

Realized inflation landed close to expectations in January, as negative base effects weighed on the annual rates. Remaining sticky inflation is largely explained by services, while tariff-driven goods inflation remains limited even in the US.

Ripple Price Forecast: XRP potential bottom could be in sight

Ripple edges up above the intraday low of $1.35 at the time of writing on Friday amid mixed price actions across the crypto market. The remittance token failed to hold support at $1.40 the previous day, reflecting risk-off sentiment amid a decline in retail and institutional sentiment.