We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Mixed
Oil - US Crude
Bullish
Wall Street
Mixed
Gold
Mixed
GBP/USD
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
USD/JPY
Bearish
More View more
Real Time News
  • The Mexican Peso could come under further selling pressure and push $USDMXN back above the 25.000 handle. Get your USD/MXN market update from @RichDvorakFX here: https://t.co/nuG3l0YpUW https://t.co/RG5xnr118p
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 95.82%, while traders in US 500 are at opposite extremes with 71.97%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/VDiXoqXTgf
  • RT @HayekAndKeynes: $198bn of buybacks (equivalent to 27% of ’19 spend) have already been suspended
  • Retail CFD traders at IG are building up their short positions to the highest level I have on my records (stretching only back a year). Nearly a 7 fold increase of the short interest at the start of the year https://t.co/SAmUD2ymIz
  • US Equity Close: $SPX +3.30% $DJI +3.07% $NDX +3.62% $RUT +1.10% $VIX -8.93
  • Indices Update: As of 20:00, these are your best and worst performers based on the London trading schedule: Germany 30: 0.91% France 40: 0.53% US 500: -0.12% Wall Street: -0.13% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/uRmj2JayN8
  • S&P 500 Continues Recovery, NFP Looms Large for US Data https://www.dailyfx.com/forex/fundamental/daily_briefing/session_briefing/daily_fundamentals/2020/03/30/ES-SPY-SPX-SP500-Continues-Recovery-NFP-Looms-Large-JS.html https://t.co/SZLy1nqPaz
  • US House Speaker Nancy Pelosi says she does not expect bipartisan virus bill until after After break $SPX $DXY
  • RT @lisaabramowicz1: The economic downturn is happening so fast that the New York Fed launched a new weekly economic index that assesses re…
  • #Gold: Price is holding up well with a small consolidation phase that could lead gold higher towards the 1680/1700 region. Get your $XAUUSD market update from @PaulRobinsonFX here: https://t.co/R5C6K0IVWh https://t.co/Gw0DX1VAgB
GBP: Sterling Building A Base on Brexit Progress

GBP: Sterling Building A Base on Brexit Progress

2018-09-06 09:20:00
Nick Cawley, Analyst
Share:

Sterling (GBP) Talking Points:

  • Positive sentiment sees GBPUSD regain 1.2900
  • With talks ongoing, wire headlines will continue to determine short-term moves.

The DailyFX Q3 GBP Forecast is available to download.

Brexit Sentiment Takes a Positive Turn

The news late Wednesday that Germany was ready to accept a less detailed Brexit agreement on future EU-UK trade sent Sterling sharply higher and near 1.3000 before the inevitable semi-denial of the agreement trimmed gains. As has been the case throughout the Brexit negotiations, language and nuance need to be monitored closely for clues of further decisions ahead. Germany’s latest intervention in itself will not change the EU’s negotiating stance but shows that the largest country in the EU wants talks to progress and signals that a hard-Brexit is their least desirable outcome.This stance will give talks a push forward and counteract the negative sentiment that has weighed on the British Pound for the last few months.

Talks remain ongoing between the EU and the UK and further roadblocks and negative commentary can be expected all the way through to the end of the negotiating process. This still leaves the UK currency vulnerable to a pull-back, but with so much negative sentiment built into GBP over the last few months, these pull-backs will become increasingly shallow and on balance Sterling will move slowly higher.

Sterling Dips Look Attractive After Brexit Breakthrough

GBPUSD remains in thrall to the strong dollar and upside will be constrained as the US continues to normalize monetary policy by raising interest rates. The daily GBPUSD chart below shows resistance from the 50-day moving average at 1.29730 ahead of the recent high (August 30) at 1.3044. If GBPUSD can build a base above the latter level, then the July 9 high at 1.3364 becomes the next target.

IG Client Sentiment shows traders remain net-long GBPUSD – see how daily and weekly positional changes steer trader sentiment.

GBPUSD Daily Price Chart (January – September 6, 2018)

GBP: Sterling Building A Base on Brexit Progress

A cleaner way of trading Brexit negotiations is by using EURGBP. Here Fibonacci resistance at 0.90723 is capping the upside while the 20-day (0.89960) and 50-day (0.894200 moving averages are acting as downside brakes ahead of Fibonacci retracement at 0.89272.

EURGBP Daily Price Chart (May 2017 – September 6, 2018)

GBP: Sterling Building A Base on Brexit Progress

Traders may be interested in two of our trading guides – Traits of Successful Traders and Top Trading Lessons – while technical analysts are likely to be interested in our latest Elliott Wave Guide.

--- Written by Nick Cawley, Analyst

To contact Nick, email him at nicholas.cawley@ig.com

Follow Nick on Twitter @nickcawley1

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.