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THE GBP/USD CLINGS TO GAINS AHEAD OF US DATA
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The GBP/USD pair maintained its strong bid tone through the early North American session and refreshed daily tops, around the 1.3145 region in the last hour.To get more news about WikiFX, you can visit wikifx official website.
The pair showed some resilience near mid-1.3000s and caught some fresh bids on Tuesday, snapping two consecutive days of the losing streak to over one-week lows. The strong intraday positive move was sponsored by the emergence of some fresh selling around the US dollar.
The prevalent risk-on mood, amid positive NEWS on a potential treatment for COVID-19 and US-China trade talks, undermined the greenback's relative safe-haven status against its British counterpart. This, in turn was seen as a key factor driving the GBP/USD pair higher.
The global risk sentiment remained well supported by reports that the Trump administration is considering fast-tracking the authorization of an experimental vaccine being developed by AstraZeneca and Oxford University for use in the US ahead of the elections.
Meanwhile, the US Trade Representatives Office said in a statement that both the US and China see progress made on resolving issues in phase one trade deal between the two countries. The development further boosted investors' appetite for riskier assets.
On the other hand, the GBP seemed rather unaffected by the lack of progress in Brexit talks. Bullish traders even shrugged off the data, which showed that the UK retail sector is struggling. In fact, the Confederation of British Industrys distributive trade survey fell into negative territory in August, to -6% from the +4% reading in July.
From a technical perspective, the GBP/USD pair now seems to have found acceptance above 100-hour SMA and now seems poised to gain further.
Some follow-through buying beyond mid-1.3100s will reaffirm the bullish bias and push the pair further towards reclaiming the 1.3200 mark.
However, bulls might refrain from placing aggressive bets ahead of the Fed Chair Jerome Powell's speech at the Jackson Hole Symposium, later this week. Hence, any subsequent positive move runs the risk of fizzling out rather quickly.
Market participants now look forward to the US economic docket, highlighting the release of the Conference Board's Consumer Confidence Index. The data, along with the broader market risk sentiment will influence the USD price dynamics and produce some short-term trading opportunities.