- The pound bounces up to 1.3185, erases previous losses.
- Cable rushes higher ahead of the London closing time.
- GBP/USD, unlikely to rally significantly above 1.32/33 – ING.
The pound has erased previous losses during Friday’s American session. The pair has bounced up strongly from 1.3110 to reach intra-day highs at 1.3185 so far.
Cable turns positive on daily charts
The GBP/USD has rallied more than 0.5% in the last few hours, to erase the European trading session’s decline. In absence of significant macroeconomic releases, positions squaring moves ahead of the London closing bell might be behind the pound’s recovery.
The pound had been hitherto trading lower, weighed by the Bank of England’s dovish statement, after releasing its monetary policy decision on Thursday, while the sourer market mood, as hopes of progress in the Russia – Ukraine peace talks start to fade have favored the safe-haven USD, thus increasing negative pressure on the GBP.
Beyond that, investors have remained remain cautious, reluctant to take excessive risks ahead of the conference between Biden and Chinese President Xi Jinping, after the US warned China about important consequences if they decide to send military aid to Russia.
GBP/USD: levels near 1.32/33, the best case for some time – ING
From a longer-term perspective, currency analysts at ING are skeptical about a significant GBP rally over the coming months: “Unlike the Fed, the BoE delivered a cautious 25bp rate hike, with one dissenter voting for unchanged rates. The market removed roughly one 25bp hike from its expectations this year (Bank Rate now priced at 1.90% in December) (…) Given we strongly favor the dollar this summer, levels near 1.32/33 in the cable may be the best for some time.”
Technical levels to watch
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD jumps towards 1.0600 as USD wilts amid risk rebound
EUR/USD is trading back above 1.0550, resuming its recovery towards 1.0600 in the European session this Wednesday. The US dollar is falling as the risk rebound extends, despite looming recession fears. ECB Forum, US Durable Goods and Fedspeak eyed.
GBP/USD extends gains above 1.2300 amid weaker USD, Brexit news
GBP/USD is extending the advance above 1.2300 in European trading, The risk-on mood dents the US dollar's safe-haven appeal while the UK presses on with changes to the Brexit deal despite EU opposition. Key US data awaited.
Gold bulls aim for $1,850 on Russia news, softer USD
Gold Price extends Friday’s recovery to $1,836 ahead of Monday’s European session. The precious metal’s upside moves could be linked to the softer US dollar, as well as chatters surrounding a ban on gold imports from Russia.
What’s next after cryptos meet stiff resistance
Bitcoin price has shown incredible resilience after its massive crash in the second week of June. Since then BTC has produced considerable gains over the past week and the start of a new week brings the promise of even higher returns.
FXStreet Premium users exceed expectations
_XtraSmall.png)
Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!