GBP/USD ticks up above 1.2550 as US Dollar recovery stalls

The pound picks up on Monday with the USD losing steam.
Cooling hopes of Fed cuts are likely to keep US Dollar losses limited.
GBP/USD is expected to meet resistance at 1.2600.

Guillermo Alcala FXStreet

The Sterling is trimming some losses on Monday’s European session, with the US Dollar losing upside momentum. The broader bearish trend, however, remains active, with investors cautious ahead of key UK data and major central banks’ decisions.

US employment data has boosted the US Dollar

US employment data boosted the Dollar last Friday, with the Nonfarm payrolls beating expectations and wages growing too fast to allow the Federal Reserve to start cutting rates in the coming months. This is likely to cushion US Dollar declines over the coming sessions.

In the calendar, Tuesday’s UK Employment data and the US CPI will attract the market focus ahead of the all-important Fed monetary policy meeting on Wednesday.

The US central bank is expected to leave its benchmark rate on hold. The main attraction of the event will be the MPC members’ interest rate projections and Powell’s press conference for hints about any dovish turn that would hurt the US Dollar.

On Thursday, the BoE will keep rates on hold, with BoE Bailey expected to give more info about the bank’s next steps.

GBP/USD rebound to meet resistance at 1.2600

The technical picture shows the pair gathering bullish strength, yet still below 1.2600 resistance, which would negate the near-term corrective mood, and expose 1.2650 ahead of the mentioned 1.2730.

On the downside, supports are Friadau’s low at 1.2500 and November 22 low at 1.2450.

Technical levels to watch

GBP/USD

Overview
Today last price	1.2572
Today Daily Change	0.0024
Today Daily Change %	0.19
Today daily open	1.2548

Trends
Daily SMA20	1.255
Daily SMA50	1.2339
Daily SMA100	1.2464
Daily SMA200	1.2486

Levels
Previous Daily High	1.2602
Previous Daily Low	1.2502
Previous Weekly High	1.2724
Previous Weekly Low	1.2502
Previous Monthly High	1.2733
Previous Monthly Low	1.2096
Daily Fibonacci 38.2%	1.254
Daily Fibonacci 61.8%	1.2564
Daily Pivot Point S1	1.25
Daily Pivot Point S2	1.2452
Daily Pivot Point S3	1.2401
Daily Pivot Point R1	1.2599
Daily Pivot Point R2	1.265
Daily Pivot Point R3	1.2698

Author

Guillermo Alcala

FXStreet

Graduated in Communication Sciences at the Universidad del Pais Vasco and Universiteit van Amsterdam, Guillermo has been working as financial news editor and copywriter in diverse Forex-related firms, like FXStreet and Kantox.

AUD/USD flatlines near 0.6965 as less hawkish RBA counters USD weakness

AUD/USD holds steady above a two-week low, trading near 0.6965 in the Asian session on Wednesday as early midterm election results heighten political uncertainty and weigh heavily on the US Dollar. Moreover, reviving safe-haven demand triggers a fresh leg down in US bond yields, offsetting Fed hike bets and exerting additional pressure on the buck. However, a less hawkish RBA caps the Aussie.

USD/JPY declines below 158.00 as USD weakens on midterm election results

USD/JPY comes under heavy selling pressure on Wednesday, dropping below 158.00 during the Asian session as the US Dollar slumps to a one-month low amid heightened political uncertainty after early US midterm vote counts. Moreover, the prospect of gridlock in Washington drives safe-haven flows, triggering a fresh leg down in US bond yields and further weighing on the buck.

Gold clings to gains near weekly top, comfortably above $4,000 as US elections hit USD

Gold clings to strong intraday gains near the weekly high, trading comfortably above the $4,000 psychological mark during early European session amid a broadly weaker US Dollar. Democrats’ wins in the House and Senate raise the prospect of gridlock in Washington. Moreover, heightened political uncertainty drove investors to safe-haven assets, exerting downward pressure on US bond yields. This is seen weighing on the Greenback and supporting the precious metal.

Bitcoin tests critical support, Ethereum struggles below resistance, XRP extends losses

Bitcoin (BTC), Ethereum (ETH) and Ripple (XRP) remain under pressure on Wednesday as bearish momentum continues to weigh on prices. BTC approaches key support around $76,466, and a decisive close below could open the door to deeper losses. Meanwhile, ETH struggles below key resistance while XRP faces rejection at the upper trendline of a falling channel pattern, all hinting at deeper losses.

ADP Employment Report expected to show slower job growth in October

The Automatic Data Processing Research Institute is due to release October’s private-sector employment report on Wednesday. The market consensus anticipates a moderate slowdown in job creation, with the ADP Employment Change expected to show 69K new private jobs in October, down from 90K in September.

The 2% inflation target came from a throwaway remark. It now moves trillions

The Federal Reserve's 2% inflation goal grew out of an off-the-cuff remark by a New Zealand politician in 1988. Bond investors still price long-term US debt as if 2% holds, so a change in how the Fed measures inflation would move markets.