GBP/USD: Mildly bid around 1.2635 ahead of a busy day
- Political pessimism remains on the spotlight ahead of the US President’s visit.
- Manufacturing PMI could also entertain momentum traders.
Despite looming political pessimism at the UK, GBP/USD is taking the rounds near 1.2635 during the early Asian session on Monday.
Alike rest of the major currencies, the British Pound (GBP) also took advantage of the greenback weakness on Friday when it recovered from the 21-week low.
The recovery seems to remain intact, though with less strength, during early-day trading as investors hold a bearish bias for the US Dollar amid latest negatives from China indicating top-tier companies from the US to be on the dragon nation’s blacklist.
Market sentiment was also affected as investors await details of the US President Donald Trump’s visit to Britain while May month manufacturing purchasing manager index (PMI) from the UK and the US can add on analysts’ burden.
President Trump is likely to follow the latest rise of Brexit party’s popularity by suggesting Nigel Farage should lead Brexit talks with the EU. He may also threaten the UK for its decision to allow Huawei for 5G networks and can offer more suggestion to solve Brexit.
At the data front, the UK manufacturing PMI may soften to 52.4 from 53.1 but its counterpart from US ISM could cross the previous readout of 52.8 with 53.3.
Technical Analysis
Not only 1.2560 and 1.2500 but 1.2480 and the current year’s low near 1.2430 could also question bear’s additional rule amid oversold conditions of 14-day relative strength index (RSI).
On the flipside, 1.2710 and 21-day simple moving average (SMA) near 1.2775 may limit the quote’s near-term advances ahead of pushing buyers to confront April month low near 1.2865.
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
