British Pound (GBP) Latest: Break Higher in GBP/USD Improves Outlook
GBP price, Brexit news and analysis:
- GBP/USD has broken convincingly to the upside from a symmetrical triangle chart pattern, implying that further gains can be expected.
- The move has come despite a continuing lack of progress in the talks between the UK and the EU on their post-Brexit relationship that resume today.
- More generally, so-called “risk” assets, including GBP, are continuing to benefit from hopes of a quick economic rally from the slump caused by the coronavirus outbreak.
GBP/USD outlook brightens
GBP/USD is heading for its fifth consecutive session of gains, breaking convincingly above the 1.25 level, reaching its highest level since May 1 and rising above the resistance line of a symmetrical triangle chart pattern in place since March 19. This all implies further gains for the pair despite the turmoil in the US and the ongoing tensions between the US and China.
GBP/USD Price Chart, Daily Timeframe (March 3 – June 2, 2020)
Chart by IG (You can click on it for a larger image)
Talks between the UK and the EU on their relationship after the Brexit transition period resume Tuesday with the two sides still far apart. However, a breakthrough cannot be ruled out and any signs of one would likely strengthen Sterling further.
The British Pound is also benefiting from the ongoing slide in the US Dollar as traders shun safe havens and opt for riskier assets on hopes of a global economic recovery from the coronavirus carnage and continuing monetary stimulus from the world’s central banks.
Meanwhile, data from the Nationwide lender showed UK house prices fell by the most in more than 11 years in May, down 1.7% month/month – the biggest monthly drop since February 2009.
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--- Written by Martin Essex, Analyst and Editor
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.