GBP/USD surrenders intraday gains, flat-lined around mid-1.3300s


  • GBP/USD struggled to preserve early gains and witnessed a modest intraday pullback.
  • Not so optimistic Brexit comments by Von der Leyen took its toll on the British pound.
  • A weaker greenback helped limit the downside ahead of US macro data, FOMC minutes.

The GBP/USD pair quickly retreated over 50 pips in the last hour and dropped to fresh daily lows, around the 1.3330 region, albeit lacked any follow-through selling.

The pair struggled to capitalize on its early uptick, instead met with some fresh supply near the 1.3385 region and drifted into the negative territory during the early European session. The sharp pullback came after not so optimistic Brexit-related comments by the European Commission president Ursula von der Leyen.

The top eurocrat warned that a Brexit deal is far from certain as the disagreement over access to Britain's fishing waters continues to block progress. Von der Leyen also said that there had been genuine progress in Brexit talks but not enough to produce a significant breakthrough on key sticking points, including state-aid rules.

With very little time left before the Brexit transition periods end on December 31, the headlines took its toll on the British pound and turned out to be one of the key factors behind the GBP/USD pair's sudden fall. However, the prevalent selling bias surrounding the US dollar extended some support and helped limit deeper losses for the major.

The latest optimism over the progress toward remedies for COVID-19, the smooth beginning of President-elect Joe Biden's transition to the White House remained supportive of the upbeat market mood. This was evident from a positive tone around the equity markets, which continued undermining the greenback's relative safe-haven status.

From a technical perspective, the GBP/USD pair's repeated failures ahead of the 1.3400 mark could be seen as signs of bullish exhaustion. That said, the lack of any follow-through selling, rather the emergence of some dip-buying at lower levels support prospects for additional gains. This warrants some caution before placing aggressive directional bets.

Market participants now look forward to a flurry of top-tier US macro data for some short-term trading opportunities. Wednesday's US economic docket highlights the releases of the preliminary (second estimate) GDP report, Durable Goods Orders, Initial Weekly Jobless Claims and final Michigan Consumer Sentiment Index for November.

The key focus, however, will be on the latest FOMC meeting minutes, which will be scrutinized for the possibility of any further policy easing by the Fed in December. The Fed's policy outlook will influence the USD price dynamics, which, along with fresh Brexit updates should assist investors to determine the near-term trajectory for the GBP/USD pair.

Technical levels to watch

GBP/USD

Overview
Today last price 1.3343
Today Daily Change -0.0019
Today Daily Change % -0.14
Today daily open 1.3362
 
Trends
Daily SMA20 1.3149
Daily SMA50 1.3018
Daily SMA100 1.2998
Daily SMA200 1.2722
 
Levels
Previous Daily High 1.338
Previous Daily Low 1.3293
Previous Weekly High 1.3312
Previous Weekly Low 1.3166
Previous Monthly High 1.3177
Previous Monthly Low 1.282
Daily Fibonacci 38.2% 1.3347
Daily Fibonacci 61.8% 1.3326
Daily Pivot Point S1 1.331
Daily Pivot Point S2 1.3258
Daily Pivot Point S3 1.3222
Daily Pivot Point R1 1.3397
Daily Pivot Point R2 1.3433
Daily Pivot Point R3 1.3485

 

 

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

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD rises above 1.21 amid better market mood

EUR/USD has been extending its gains, recapturing 1.21 as the market mood improves. The German ZEW Economic Sentiment beat estimates with 61.8 points. Treasury Secretary nominee Janet Yellen's testimony is awaited.

EUR/USD News

GBP/USD clings to 1.36 ahead of Yellen's testimony

GBP/USD is edging above 1.36 as markets eagerly Treasury Secretary nominee Janet Yellen's testimony. The UK parliament is set to process the Brexit deal as Britain ramps up its vaccination campaign.

GBP/USD News

Gold recovers further from multi-week lows, climbs to $1845 region

Gold gained positive traction for the second consecutive session on Tuesday. A modest USD pullback was seen as a key factor that benefitted the metal. The risk-on mood, rallying US bond yields might cap gains for the commodity.

Gold news

Breaking: Ethereum explodes to new yearly high, validating upward price action

Ethereum has ascended to new yearly highs after breaking the recent peak achieved in January. The flagship altcoin is trading at $1,372 amid the push for gains eyeing $1,400. 

Read more

US Dollar Index: Downside pressure alleviated above 91.00

DXY met sellers in the 91.00 neighbourhood on Monday and now retreats to the 90.50 region on turnaround Tuesday.

US Dollar Index News

Forex MAJORS

Cryptocurrencies

Signatures