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USD Demand Emerges in Europe, Counters GBP/USD Month-end Recovery

GBP
MNI (London)
  • GBP benefited from month-end flow, as reported Wednesday, with GBP/USD able to extend its recovery away from Tuesday's low of $1.3706 to $1.3812 in post 1600BST fix trade.
  • EUR/GBP was pressed to a fresh YTD low of Gbp0.8502, though recently reported barrier interest at Gbp0.8500 continues to keep rate shy of this level.
  • GBP/USD eased to $1.3777 before closing the month at $1.3784.
  • Slight bid tone in early Asia allowed rate to edge to $1.3791, from an opening low of $1.3775, before general USD demand emerged ahead of the European open to press rate down to $1.3756. Rate currently trades around $1.3765.
  • Support $1.3755/45, $1.3730 ahead of stronger interest into $1.3700, break to expose $1.3670/63. Resistance $1.3791 ahead of $1.3812/14(Mar31 high/76.4% $1.3847-1.3706) , a break of this latter level to relieve mild bearish tone.
  • UK final Mfg PMI at 0830GMT(flash 57.9) provides domestic data interest.
  • US Weekly Jobless Claims 1230GMT, MFG PMI 1345GMT, ISM Mfg 1400GMT.
  • Easter approaching 4-day weekend in UK though expect some trading rooms to be active Friday due to release of US NFP.
  • MNI Techs: GBPUSD maintains a bearish tone. This follows the recent breach of the bull channel base from the Nov 2, 2020 low. Furthermore, price has also traded through the 50-day EMA and a former key support at 1.3779, Mar 5 low, triggering an important short-term reversal. The focus is on 1.3663 next, Feb 5 low. On the upside, the former channel base at 1.3883 provides an initial firm resistance.
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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