• A modest USD retracement helps recover early lost ground to over 1-week lows.
• Brexit uncertainties/dismal UK retail sales data kept a lid on any meaningful up-move.
• Investors look forward to fresh Brexit-related headlines from the ongoing EU summit.
The GBP/USD pair struggled to build on its intraday recovery move from over one-week lows and is currently placed in neutral territory, just above the 1.3100 handle.
The pair, for the second time this week, showed some resilience below 100-day SMA and quickly reversed an early dip to an intraday low level of 1.3076. The uptick was supported by a modest US Dollar retracement from near two-week lows, albeit lacked any strong follow-through.
Against the backdrop of persistent Brexit uncertainties, the British Pound was further weighed down by today's worse than expected UK monthly retail sales data, showing a sharp fall of 0.8% in September, the biggest drop in six months.
Adding to this, the prevalent cautious mood across global financial markets, amid resurfacing US-China trade war fears, benefitted the USD's relative safety against its British counterpart and further collaborated towards keeping a lid on any meaningful up-move.
Despite a combination of negative factors, the downside remained limited as investors now seemed reluctant to place any aggressive bets and preferred to wait for any fresh Brexit news/developments from the second day of a crucial EU summit in Brussels.
Technical levels to watch
A convincing break below the 1.3080-75 region is likely to accelerate the fall towards the key 1.30 psychological mark with some intermediate support near the 1.3035 level. On the flip side, the 1.3130-35 region now seems to have emerged as an immediate resistance, above which the pair is likely to aim towards reclaiming the 1.3200 round figure mark.
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 treads water just above 1.0400 post-US data
Another sign of the good health of the US economy came in response to firm flash US Manufacturing and Services PMIs, which in turn reinforced further the already strong performance of the US Dollar, relegating EUR/USD to the 1.0400 neighbourhood on Friday.
GBP/USD remains depressed near 1.2520 on stronger Dollar
Poor results from the UK docket kept the British pound on the back foot on Thursday, hovering around the low-1.2500s in a context of generalized weakness in the risk-linked galaxy vs. another outstanding day in the Greenback.
Gold keeps the bid bias unchanged near $2,700
Persistent safe haven demand continues to prop up the march north in Gold prices so far on Friday, hitting new two-week tops past the key $2,700 mark per troy ounce despite extra strength in the Greenback and mixed US yields.
Geopolitics back on the radar
Rising tensions between Russia and Ukraine caused renewed unease in the markets this week. Putin signed an amendment to Russian nuclear doctrine, which allows Russia to use nuclear weapons for retaliating against strikes carried out with conventional weapons.
Eurozone PMI sounds the alarm about growth once more
The composite PMI dropped from 50 to 48.1, once more stressing growth concerns for the eurozone. Hard data has actually come in better than expected recently – so ahead of the December meeting, the ECB has to figure out whether this is the PMI crying wolf or whether it should take this signal seriously. We think it’s the latter.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.