GBP/USD Stalling out near 1.34 as Brexit talks continue to yield little progress

The Sterling is continuing to flatten out following a volatile yet unchanged Thursday.
A thin calendar sees broader market sentiment and apprehension over the upcoming G7 summit in the captain's chair to cap off the week.

Joshua Gibson FXStreet

The GBP/USD is flat for Asia, sticking close to the 1.3400 handle as the Sterling struggles to develop momentum with markets awaiting fresh headlines on Brexit.

The GBP faced a rough ride on Thursday, marking in an outside candle as the pair hit both new highs and a fresh low against the previous day, before ending the day near where it started, and the Sterling is trading flat ahead of a Friday that sees little data on the economic calendar to finish off the week.

This Friday's focus will largely swing to the upcoming G7 summit meeting, where US President Donald Trump will be joining a group of his fellow world leaders where current trade tensions are sure to take front-and-center of discussions amongst the other G7 leaders.

Brexit progression continues to remain frustratingly slow, and the current plan of attack for the UK is to set up a backstop plan that will see the UK remain in the EU customs union for a year, a plan that has already seen some pushback from EU leaders. Further developments are expected next week, and Sterling bulls will be keeping a close eye on the continuing negotiations into Monday.

GBP/USD levels to watch

FXStreet's Chief Analyst, Valeria Bednarik, with the Sterling's technical stance heading into the Friday trading session: "the GBP/USD pair bottomed at 1.3372 and regained the 1.3400 on broad dollar's weakness and comments from BOE´s Ramsden, who said that the slowdown in Q1 was temporary and that wages are set to rise. Now trading at around 1.3430, the 4 hours chart shows that the buying interest defended ground around a bullish 20 SMA, while technical indicators have retreated from overbought levels, but pared their slides and are actually trying to regain the upside, favoring another leg lower, although Brexit jitters may be a drag, opposing to technical readings."

Support levels: 1.3395 1.3360 1.3320

Resistance levels: 1.3450 1.3490 1.3530

Author

Joshua Gibson

FXStreet

Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.

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