GBPUSD SIGNAL 18-07-22 : GBPUSD steadily climbs above mid-1.1900s amid broad-based USD weakness.

0
340
GBPUSD SIGNAL

GBPUSD SIGNAL 18-07-22 : GBPUSD steadily climbs above mid-1.1900s amid broad-based USD weakness.

  • GBP/USD gained traction for the second straight day amid the ongoing USD profit-taking slide.
  • Receding bets for more aggressive Fed rate hikes and the risk-on impulse undermined the buck.
  • Brexit woes could act as a headwind for sterling and keep a lid on any further gains for the pair.

GBPUSD SIGNAL : The GBPUSD pair built on last week’s late bounce from the vicinity of mid-1.1700s, or its lowest level since March 2020 and kicked off the new week on a positive note. The intraday move up extended through the early part of the European session and lifted spot prices to a multi-day high, around the 1.1965 region.

Several Federal Reserve officials signalled last week that they did not favour the bigger rate hike that the markets priced in following the release of red-hot US consumer inflation. Investors were quick to react and trimmed their bets for a supersized 100 bps Fed rate hike move in July. Apart from this, the risk-on impulse led to an extension of the US dollar profit-taking slide from a two-decade high, which, in turn, provided a goodish lift to the GBP/USD pair.

GBPUSD SIGNAL : The British pound drew additional support from rising odds for another 50 bps rate hike by the Bank of England in August, bolstered by last week’s upbeat UK macro releases. Monday’s strong move up of over 100 pips could further be attributed to some technical selling on a sustained strength above the 1.1900 round-figure mark. That said, Brexit woes could act as a headwind for sterling and hold back bulls from placing aggressive bets around the GBP/USD pair.

Investors remain worried that the UK government’s controversial Northern Ireland Protocol Bill could trigger a trade war with the European Union amid the ongoing cost-of-living crisis. This makes it prudent to wait for strong follow-through buying before confirming that the GBP/USD pair has formed a near-term bottom. In the absence of any major market moving economic data, either from the UK or the US, the USD price dynamics would be looked upon for some impetus.

Confuse Which Broker is best ? , Here you can find the best regulated broker.

LEAVE A REPLY

Please rate*
Please enter your comment!
Please enter your name here