GBP/USD quickly recovers over 40-pips from sub-1.3100 level

Haresh Menghani FXStreet

• Quickly reverses a dip to sub-1.3100 handle.
• Broad-based USD weakness lending support.
• Focus remains on the US tax reform bill.

The GBP/USD pair quickly reversed a dip to sub-1.3100 level and has now rebounded around 40-pips from session lows.

Currently trading around the 1.3125-30 region, the pair once again managed to rebound from the 1.3085 region and was being supported by persistent US Dollar selling bias, led by increasing nervousness over the long-awaited US tax reforms plan.

Mounting uncertainty surrounding the Republican-led tax-cut legislation kept exerting pressure on the greenback and is turning out to be a sole driver of the pair's sharp recovery over the past couple of hours.

• USD consolidates as the US fiscal drama plays out - BBH

It, however, remains to be seen if the pair can build on the up-move or once again meets with some fresh supply at higher levels amid the latest UK political crisis and concerns over the lack of progress on Brexit negotiations.

• UK government remains in turmoil - BBH

Next on tap would be the weekly initial jobless claims data from the US. The US tax bill would remain in focus as investors brace for the release of the legislation text, expected to be revealed later today.

Technical levels to watch

Immediate resistance remains near the 1.3175-80 region, above which the pair is likely to surpass the 1.3200 handle and aim towards retesting the 1.3225-30 heavy supply zone.

On the flip side, the 1.3100-1.3085 region now seems to have emerged as immediate strong support, which if broken would turn the pair vulnerable to head towards testing the key 1.30 psychological mark.

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

EUR/USD stays defensive below 1.1900 as USD recovers

EUR/USD trades in negative territory for the third consecutive day, below 1.1900 in the European session on Thursday. A modest rebound in the US Dollar is weighing on the pair, despite an upbeat market mood. Traders keep an eye on the US weekly Initial Jobless Claims data for further trading impetus.

GBP/USD holds above 1.3600 after UK data dump

\GBP/USD moves little while holding above 1.3600 in the European session on Thursday, following the release of the UK Q4 preliminary GDP, which showed a 0.1% growth against a 0.2% increase expected. The UK industrial sector activity deteriorated in Decembert, keeping the downward pressure intact on the Pound Sterling.

Gold sticks to modest intraday losses as reduced March Fed rate cut bets underpin USD

Gold languishes near the lower end of its daily range heading into the European session on Thursday. The precious metal, however, lacks follow-through selling amid mixed cues and currently trades above the $5,050 level, well within striking distance of a nearly two-week low touched the previous day.

Cardano eyes short-term rebound as derivatives sentiment improves

Cardano (ADA) is trading at $0.257 at the time of writing on Thursday, after slipping more than 4% so far this week. Derivatives sentiment improves as ADA’s funding rates turn positive alongside rising long bets among traders.

The market trades the path not the past

The payroll number did not just beat. It reset the tone. 130,000 vs. 65,000 expected, with a 35,000 whisper. 79 of 80 economists leaning the wrong way. Unemployment and underemployment are edging lower. For all the statistical fog around birth-death adjustments and seasonal quirks, the core message was unmistakable. The labour market is not cracking.

Sonic Labs’ vertical integration fuels recovery in S token

Sonic, previously Fantom (FTM), is extending its recovery trade at $0.048 at the time of writing, after rebounding by over 12% the previous day. The recovery thesis’ strengths lie in the optimism surrounding Sonic Labs’ Wednesday announcement to shift to a vertically integrated model, aimed at boosting S token utility.