- The first round of voting for Tories to select their new leader takes place today.
- All the 10 candidates need at least 16 votes (5%) to remain on the card.
- The expected lead of Boris Johnson and demise of a motion to block no-deal Brexit highlights the risk.
While the failure of Labour-led motion to block the chances of no-deal Brexit weakened the Pound (GBP), the GBP/USD pair remains on a back foot around 1.2690 as traders await the first round of voting to decide the new Tory leader while heading into the London open on Thursday.
Even if the ex-London Mayor Boris Johnson is leading the run to become the next British Prime Minister mainly due to his Brexit hardliner image, he needs to get through today’s parliament voting with more than 16 votes in order to remain in the race.
Mr. Johnson recently announced his election propaganda to leave the block by October 31. However, the latest clues have mostly been silent about his stance on dealing with the EU during the time.
The opposition Labour party continues to signal another attempt to block the no-deal Brexit sometime in the near future but the markets give less importance to it.
At the US, the greenback holds its status as the market favorite amid less dovish Fed highlighting its safe-haven demand in times when the trade tussles are in the spotlight.
Given the absence of major data on the economic calendar from both the economies, investors may emphasize political plays to determine near-term trade direction.
In case of the USD, the US-China stalemate continues to flash mixed signals of a trade deal while the weekly initial jobless claims for the period ended on June 07 might soften a bit to 217K from 218K.
Elsewhere, chances are bright that some of the contestants of the UK PM’s race might be off from today and hence giving a clearer picture of the next British leader. Though, Boris Johnson is likely to remain on the top unless any surprises take place, which in turn highlights the chance of a hard Brexit and a weaker British currency given the latest failure of Labor-led motion.
Technical Analysis
The 1.2600 round-figure can offer an intermediate halt prior to shifting market attention to 1.2560 and December 2018 low near 1.2480.
Alternatively, 1.2760 and 1.2865/75 region including April low and 50-day simple moving average (SMA) could keep challenging the buyers.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD stays in daily range slightly below 1.0900
EUR/USD continues to move up and down in a narrow band slightly below 1.0900 in the second half of the day on Monday. The modest improvement seen in risk mood makes it difficult for the US Dollar to find demand and helps the pair stay in range.
GBP/USD treads water above 1.2900 amid risk recovery
GBP/USD is keeping its range play intact above 1.2900 in the American session on Monday. The positive shift seen in risk sentiment doesn't allow the US Dollar to gather strength and helps the pair hold its ground ahead of this week's key data releases.
Gold struggles to hold above $2,400
Gold loses its traction and trades in negative territory below $2,400 after suffering large losses in the second half of the previous week. The benchmark 10-year US Treasury bond yield holds above 4.2% and risk flows return to markets, not allowing XAU/USD to rebound.
Solana could cross $200 if these three conditions are met
Solana corrects lower at around $180 and halts its rally towards the psychologically important $200 level early on Monday. The Ethereum competitor has noted a consistent increase in the number of active and new addresses in its network throughout July.
Election volatility and tech earnings take centre stage
/stock-market-graph-gm532464153-55981218_XtraSmall.jpg)
The US Dollar managed to end the week higher as Trump Trades ensued. Safe-havens CHF and JPY were also higher while activity currencies such as NOK and NZD underperformed.