British Pound (GBP) Price Outlook: GBP/USD Shrugs Off Row Over MPs’ Second Jobs
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GBP price, news and analysis:
- GBP/USD continues to trade broadly sideways despite an ongoing row over whether former Conservative Attorney General Sir Geoffrey Cox broke any rules while earning more than £800,000 representing the British Virgin Islands Government in a corruption case.
- Even though this has come in the wake of the resignation of Conservative MP Owen Paterson after he was found to have breached lobbying rules over his £110,000 per year private-sector work, GBP/USD has held its ground – suggesting some underlying support for the pair.
GBP/USD well supported
A row in the UK over the second jobs of Members of Parliament has had no discernable impact so far on the Pound, suggesting that downward pressure on GBP/USD is limited despite some risk-off sentiment in the markets that has helped safe havens such as the Japanese Yen and Gold.
Sir Keir Starmer, leader of the Opposition Labour Party, has accused Conservative Prime Minister Boris Johnson of giving the “green light to corruption” but in financial markets more worried about the impact of higher oil prices on global inflation and the response by central bankers, the impact of the turmoil in Westminster has been minimal.
EUR/GBP has barely moved, and neither has GBP/USD, which remains stable just over the 1.35 mark.
GBP/USD Price Chart, One-Hour Timeframe (October 28 – November 10, 2021)
Source: IG (You can click on it for a larger image)
As for the positioning of retail traders, IG client sentiment data show64.66% of traders are net-long GBP/USD, with the ratio of traders long to short at 1.83 to 1. The number of traders net-long is 4.64% lower than yesterday but 6.90% higher than last week, while the number of traders net-short is 9.55% higher than yesterday but 11.89% lower than last week.
Here at DailyFX, we typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests GBP/USD prices may fall.
Positioning is less net-long than yesterday but more net-long than last week, and the combination of current sentiment and recent changes gives us a further mixed GBP/USD trading bias.
-- Written by Martin Essex, Analyst
Feel free to contact me on Twitter @MartinSEssex
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.