GBP/USD: Still room for further pullbacks – UOB

Pablo Piovano FXStreet

In the view of Economist Lee Sue Ann and Markets Strategist Que Ser Leang at UOB Group, GBP/USD still risks extra declines in the next few weeks.

Key Quotes

24-hour view: “We expected GBP to trade in a range between 1.2385 and 1.2465 yesterday. In London trade, GBP popped briefly to 1.2470 and then plummeted to end the day at 1.2366 (-0.40%). While the rapid drop appears to be oversold, GBP could drop below 1.2350. That said, the next major support at 1.2300 is unlikely to come into view today. The downside risk is intact as long as GBP stays below 1.2435 (minor resistance is at 1.2400).”

Next 1-3 weeks: “We turned negative in GBP about two weeks ago on 12 May, when GBP was trading at 1.2515. Yesterday (24 May, spot at 1.2420), we indicated that ‘the downside risk in GBP is intact as long as it does not break above 1.2500’. In NY trade, GBP dropped to a low of 1.2358, not far above our target of 1.2350. The price actions continue to suggest downside risk in GBP. A clear break below 1.2350 will shift the focus to 1.2300. On the upside, a breach of 1.2470 (‘strong resistance’ level previously at 1.2500) would indicate that GBP is not weakening further.”

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

EUR/USD holds firm above 1.1900 as US NFP looms

EUR/USD holds its upbeat momentum above 1.1900 in the European trading hours on Wednesday, helped by a broadly weaker US Dollar. Markets could turn cautious later in the day as the delayed US employment report for January will takes center stage.

GBP/USD recovers losses despite rising UK political risks, BoE rate cut bets

Pound Sterling advances against the US Dollar after registering modest losses in the previous session, trading around 1.3650 during the Asian hours on Wednesday. The pair could extend losses as the Pound Sterling faces pressure from rising political risks in the UK and growing expectations of near-term Bank of England rate cuts.

Gold sticks to gains near $5,050 as focus shifts to US NFP

Gold holds moderate gains near the $5,050 level in the European session on Wednesday, reversing a part of the previous day's modest losses amid dovish US Federal Reserve-inspired US Dollar weakness. This, in turn, is seen as a key factor acting as a tailwind for the non-yielding yellow metal ahead of the critical US NFP release.

US Nonfarm Payrolls expected to show modest job gains in January

The United States Bureau of Labor Statistics will release the delayed Nonfarm Payrolls data for January on Wednesday at 13:30 GMT. Investors expect NFP to rise by 70K following the 50K increase recorded in December.

Dollar drops and stocks rally: The week of reckoning for US economic data

Following a sizeable move lower in US technology Stocks last week, we have witnessed a meaningful recovery unfold. The USD Index is in a concerning position; the monthly price continues to hold the south channel support.

BNB prolonged correction signals deeper bearish momentum

BNB (BNB), formerly known as Binance Coin, is trading below $618 on Wednesday, marking the sixth consecutive day of correction since the weekend. The bearish price action is further supported by rising short bets alongside negative funding rates in the derivatives market.