GBP/USD Slumps As Brexit Back In Focus & On Stronger Dollar
Fiona Cincotta January 8, 2020 12:08 PM
A level playing field is what the EU are looking for. Time will tell whether it is what Boris Johnson is prepared to offer. The pound remains under pressure as traders doubt whether 1 year will be sufficient tine to agree a deal.
Dollar Advances After Strong ADP Data
The US dollar was on the front foot at the start of Wednesday boosted by flows into safe haven assets. Yet even as US – Iran tensions eased, and risk sentiment picked up the dollar remained firm thanks in part to strong ADP data.
ADP private payroll report added a whopping 220,000 jobs in December, this was well ahead of expectations of 160,000 jobs and November’s 67,000 jobs created. Despite the impressive data, the dollar is paring gains, as flows towards riskier assets pick up.
The British Parliament is expected to vote through the Brexit Withdrawal Bill tomorrow. No hold ups are expected. As tension continues t ease in the Middle East US dollar investors could turn their attention towards Friday’s NFP.
Levels to watch
Cable is lacking bullish momentum on 4 hrs chart, below the $1.32 handle and below the 50 sma. GBP/USD is testing support at $1.31. A breakthrough here could see the price test $1.3055 opening the door to $1.30. A break above $1.3212 could bring a more bullish outlook.
Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.
Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.