GBP/USD stutters back into 1.33 after the UK's David Davis resigns as Brexit Secretary

The Sterling kicked off the week with a bullish jump, but Brexit headlines are keeping GBP traders hesitant.
UK PM May to face further opposition as pro-Brexit Tories edge towards making an outright leadership challenge.

Joshua Gibson FXStreet

The GBP/USD saw a stumble early in the new trading week, with the pair's bullish gap into 1.3318 saw a quick drop into 1.3286 following headlines that the UK's Brexit Secretary David Davis has resigned from his position in protest of Prime Minister Theresa May's No10 "soft Brexit" proposal. The GBP/USD is now trading near the 1.3300 major level, and Monday's bullish momentum has come up against a fundamental boundary.

The UK's David Davis has been confirmed to have resigned from his position as Brexit Secretary following the UK cabinet's agreement to PM May's new Brexit proposal, with hard-line Brexiteers including Davis angry over the agreement, claiming that the new proposals betray the original referendum result.

The Sterling heads into the new week with an early challenge to recent bullish momentum, and Sterling traders will be wary of upcoming challenges to Prime Minister May's leadership from hard-liners within the UK's Tory party.

GBP/USD levels to watch

according to FXStreet Chief Analyst Valeria Bednarik: "readings in the daily chart favor additional gains, as the pair ended well above a mild bearish 20 SMA, while technical indicators head north within positive territory, at their highest since last April. In the 4 hours chart, a bullish 20 SMA keeps leading the way higher, attracting buyers on intraday pullbacks, while technical indicators also maintain their bullish slopes, but below this month highs. The 200 EMA in this last time frame comes at 1.3310, while a relevant high is located at 1.3314, making of the 1.3310 an immediate and strong resistance."

Support levels: 1.3250 1.3210 1.3170

Resistance levels: 1.3315 1.3350 1.3390

Author

Joshua Gibson

FXStreet

Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.

USD/JPY eyes August swing low, near 155.20 ahead of US NFP

USD/JPY retests the August monthly swing low during the Asian session on Friday as a more hawkish repricing of BoJ rate-hike bets and a suspected intervention continue to underpin the Japanese Yen. Meanwhile, the US Dollar is seen consolidating the previous day's heavy losses amid soft US bond yields, further weighing on the currency pair as traders keenly await the US NFP report.

AUD/USD consolidates above 0.7200; US NFP awaited

AUD/USD holds steady above 0.7200, near its highest level since mid-May, as bulls await the US NFP report for more cues on the Fed's policy path before placing fresh bets. Meanwhile, the recent decline in US bond yields keeps the US Dollar depressed near its lowest level in over a week and acts as a tailwind for the Aussie amid the RBA's hawkish tilt.

Gold tumbles as blockbuster US NFP lift US Dollar, Treasury yields

Gold (XAU/USD) falls sharply on Friday, snapping a two-day recovery after the US Nonfarm Payrolls (NFP) report surprised strongly to the upside. The metal briefly climbed above $4,500 on Thursday, gaining nearly 2%, but has since erased a large part of that advance.

Crypto’s $638 million buyback boom may not be as bullish as it looks

Decentralized Finance (DeFi) protocols reportedly spent $638 million to buy back their native tokens in August, up 17% from a year earlier. On the surface, the buyback trend suggests the cryptocurrency industry is maturing fast, adopting one of Wall Street’s oldest tools to bolster valuations and distribute revenue. The headline becomes less impressive once the number is opened up.

Why hawkish Bank of Japan expectations aren't enough to sustain the Japanese Yen rally

The Japanese Yen (JPY) experienced a sudden burst higher after falling back below the 160.00 psychological mark against the US Dollar (USD) earlier this week amid a more hawkish repricing of Bank of Japan (BoJ) rate hike expectations.

Diesel’s record $100 warning: The oil shock hiding in plain sight

The Oil market may look calmer than it did a few months ago, but diesel is sending a very different message. The US diesel crack spread, the premium of ultra-low sulphur diesel futures over WTI, recently surged above $100 per barrel for the first time, reaching an intraday record of just over $102.00.