GBP price, news and analysis:
- GBP/USD will likely hold its current level or fall back a tad near-term on profit-taking after its advance this month due largely to a weak US Dollar.
- For now, the row between London and Madrid over whether Spain is safe for British holidaymakers has not been a market factor but could be if the argument grows.
GBP/USD set to consolidate near-term
After the strong gains that have lifted GBP/USD from a low of 1.2251 on June 29 to above 1.29 briefly on Monday, a period of consolidation now seems likely for the pair. The main driver of GBP/USD is still the US Dollar side of the equation so any signs that USD is stabilizing after its recent falls would take the steam out of Sterling’s advance.
GBP/USD Price Chart, Four-Hour Timeframe (June 26 – July 28, 2020)
Chart by IG (You can click on it for a larger image)
A row between the governments in London and Madrid over whether Spain is safe for British holidaymakers has so far been largely ignored by the markets but could become a factor in future if it escalates.
Meanwhile, like other pairs, the focus for GBP/USD traders will be the continuing stimulus measures being taken by the US – both monetary and fiscal – as well as corporate earnings and hopes for a coronavirus vaccine as market volumes show their usual seasonal fall.
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--- Written by Martin Essex, Analyst and Editor
Feel free to contact me via Twitter @MartinSEssex
