GBP/USD struggles to find direction above 1.2300 ahead of UK PMI


  • GBP/USD registers modest losses following Wednesday’s upbeat performance.
  • Tory leaders anticipate to be “at the peak” of the outbreak, are criticized for mishandling the coronavirus,
  • UK PMIs to portray downbeat scenario but $3.2 billion worth of bets say Pound will go up.
  • US Jobless Claims, Markit PMI and virus updates are important too.

GBP/USD drops to 1.2325, down 0.07% on a day, while heading into the London open on Thursday. A lack of major catalysts held the Cable pair tightly during Asia. Though, the key UK PMI and US Jobless Claims, coupled with activity numbers, will offer an active session ahead.

Tories under attack….

On Wednesday, the cabinet members getting their first chance to criticize the PM Boris Johnson and Company’s mishandling of the UK’s coronavirus (COVID-19) crisis. Not only shortages of medical supplies and a surging death toll beyond 18,100 but fewer nurses due to the Brexit were also being targeted on the standing leader Dominic Raab.

In response, the deputized PM defied the claims and marked nearness to the peak of the outbreak, together with the Health Secretary Matt Hancock, while also suggesting the start of the human trials over 300,000 people in a year.

Elsewhere, City A.M. marked a divide between the Tory negotiators when it comes to the Brexit. “Civil servants are increasingly frustrated that the government refuses to countenance the idea of an extension, while political appointees are keen to press home the UK’s departure,” said the news.

On the positive side, UK Metro quoted Downing Street as saying that the PM will be holding his regular audience with the Queen via telephone later this week, even though his deputy Dominic Raab is officially leading the country in his absence.

On the US side, President Trump kept pushing for the economic restart while threatening Iran and turning down the fears of a further outbreak.

Amid all these, the US 10-year Treasury yields decline to 0.60% with stocks in Asia trimming the early-day gains.

Moving on, the preliminary readings of March month’s Markit PMIs become the key to determine the near-term direction of the Cable, the reason to blame is the virus outbreak during the period. FXStreet’s Yohay Elam says, “If the data comes out below expectations, pound/dollar has room to fall as it would reveal growing pessimism among decision-makers. It would also show that the current situation is worse than previously perceived. If the figures meet expectations, they would still de gloomy. Sterling may hold up in its range in the immediate aftermath but fall afterward. Ongoing weak figures may take their toll.”

While the forecasts suggest downbeat readings of the key Manufacturing and Services PMI figures, respectively to 42 and 29 versus 47.8 and 34.5, Reuters mentions, “there is still a net $3.2 billion worth of bets that the pound will go up, but that number has been falling for the last six weeks.

Following the UK data, a heavy economic docket from the US will also be watched while pandemic details could offer intermediate clues.

Technical analysis

A seven-day-old falling trendline near 1.2395 restricts the pair’s short-term upside whereas an upward sloping trend line since March 27, around 1.2210, seems to be the immediate support.

Additional important levels

Overview
Today last price 1.2326
Today Daily Change -8 pips
Today Daily Change % -0.06%
Today daily open 1.2334
 
Trends
Daily SMA20 1.2403
Daily SMA50 1.2517
Daily SMA100 1.2796
Daily SMA200 1.2655
 
Levels
Previous Daily High 1.2386
Previous Daily Low 1.2275
Previous Weekly High 1.2648
Previous Weekly Low 1.2407
Previous Monthly High 1.3201
Previous Monthly Low 1.1412
Daily Fibonacci 38.2% 1.2344
Daily Fibonacci 61.8% 1.2317
Daily Pivot Point S1 1.2277
Daily Pivot Point S2 1.222
Daily Pivot Point S3 1.2166
Daily Pivot Point R1 1.2388
Daily Pivot Point R2 1.2443
Daily Pivot Point R3 1.25

 

 

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. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

Are you new to trading or have been trading for a while and you feel stuck?

Try with us!
Become Premium!
   

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD recovers within range, lacks follow-through

Encouraging macroeconomic data from the EU and the US boosted risked sentiment, which in turn, helped EUR/USD to advance, currently nearing the weekly high at 1.2075.

EUR/USD News

GBP/USD trades around 1.39 after a choppy reaction to the BOE

GBP/USD is trading around 1.39 after an 80-pip move around the BOE's "Super Thursday." The bank announced a slowdown in buying bonds but no change to the overall scope. US jobless claims and elections in Scotland are awaited. 

GBP/USD News

Gold Price Analysis: Gold bears seeking a correction to test bullish commitments

Gold has broken above the $1,800 mark, hitting the highest levels since February. The Confluence Detector is showing that XAU/USD has very few barriers through $1,850. Bears are lurking at resistance structure, eyeing a correction ahead of NFPs.

Gold News

Dogecoin price targets $1 as the chase for high-yielding cryptos accelerates

Dogecoin price strength combined with the complementary volume highlights the continued fascination in the digital token, portending further gains in the days ahead.

More Dogecoin News

US Nonfarm Payrolls April Preview: When the economy booms, its all about rates

The US labor market’s stars appear aligned for April.The economy is expanding rapidly, employers are confident and consumers eager to throw off the restraints of the past year.

Read more

Forex MAJORS

Cryptocurrencies

Signatures