Free Trial

Firming GBP/USD Curtailed by Pick Up in US Yields

GBP
  • GBP/USD strength into NY hours somewhat curtailed by the gradual grind higher in US Treasury yields, which tips the US 10y yield north of the post-payrolls high. The rates move underpins the greenback and helps keeps the pair contained below the Friday/Thursday high at 1.2601 and 1.2612 respectively.
  • Should spot hold at current or lower levels, GBP/USD will extend the streak of lower highs to five consecutive sessions, keeping support at the 200-dma of 1.2489 in focus. Front-end vols are well supported as contracts capture both the Fed (Weds) and BoE (Thurs) decisions, evident in one-week vols holding close to the highest levels since August.
  • Despite the weakness of the recent cycle high, the recent pullback appears to be a correction. MA studies remain in a bull-mode set-up, highlighting a rising trend. Initial firm support to watch is 1.2536, the 20-day EMA.

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.