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Back Below $1.3900 on Position Adjustment Ahead of FOMC

GBP
MNI (London)
  • GBP/USD touched a low of $1.3859 in European morning trade Tuesday before recovering into the NY session, pushing up to $1.3924 before momentum faded.
  • Rate eased to $1.3897 before it settled back above $1.3900 through to the close.
  • USD/JPY demand in early Tokyo prompted general USD demand which acted to press GBP/USD down to $1.3874 where it met support ahead of the European open.
  • Moves tracked EUR/USD, as market was seen adjusting positions ahead of this evening's FOMC/Powell press conference(1800GMT/1830GMT), with EUR/GBP holding a relatively tight range around Gbp0.8700 (remaining above key 10-dma, Gbp0.8670).
  • Nationwide House Prices at 0600GMT provides domestic interest.
  • Support $1.3874, $1.3859, $1.3849(76.4% $1.3824-1.3929), $1.3824(Apr22 low)
  • Resistance $1.3915, $1.3929(Apr26 high), $1.3938(61.8% $1.1.4009-1.3824), $1.3950/65.
  • COVID vaccine roll out continues to provide positive outlook for economic recovery in the UK but being countered by political pressure on PM Johnson (PMQ's of interest today), with Scottish elections looming next week.
  • MNI Techs: GBPUSD is slightly weaker. The pair traded lower last week following a failure at 1.4009, Apr 20 high and maintains a S/T bearish tone. The pullback means that recent gains stalled at the former bull channel base drawn off the Nov 2, 2020 low. A break of 1.4009 is required to reinstate a bullish theme and open 1.4103, a Fibonacci retracement. Short-term support has been defined at 1.3824, Apr 22 low. The key bear trigger is 1.3669, Apr 12 low.
MNI London Bureau | +44 203-586-2231 | john.webb@marketnews.com
BulletMarketsForeign Exchange Bullets
MNI London Bureau | +44 203-586-2231 | john.webb@marketnews.com
BulletMarketsForeign Exchange Bullets

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