Oil is in the arena
Oil is always the hottest topic. Other markets may be steady, however, the oil one never is.
GBP/USD: daily outlook
The British pound is hovering around key resistance line at 1.2495 being almost intact after the UK labor market report. The data was a mixed bag with jobless claims rising to the record 25.5K unseen from 2011, steady unemployment rate and upbeat wages.
Yesterday, GBP/USD rose to its monthly high on the better-than-expected inflation figures that came out of the UK. Many analysts believe that consumer prices will continue rising thanks to weak pound and surging oil prices. However, the heightened inflation rate will unlikely push the Bank of England to tighten its monetary policy. BoE’s officials said at their last meeting that they won’t be in rush to raise interest rates in the near-term future. It seems that they are prepared to tolerate inflation above the 2% target. So, we don’t expect them undertaking any measures until inflation hits at least 3%.
There are plenty of news on the Brexit front. EU members mainly backed the wording contained in draft negotiating guidelines written by European Union President Donald Tusk after Theresa May formally notified the European officials about the UK’s intentions to leave the union. The formal approval of the guidelines will be delivered at the summit in Brussels on April 29. But even after the release of the EU negotiating stance, the talks on the EU-UK future trade relationships will probably start after elections in France and then Germany. This would offer the British pound a short respite to regain its value in the near-term future.
The technical outlook for GBP/USD after the pair broke the range of strong resistances at 1.2463 (the diagonal trendline and 100-H4 MA), 1.2495 (the upper border of Ichimoku cloud on H4 timeframe) is bullish. There is a room for a further upsurge to 1.2555 (April 3 high). On the downside, the immediate supports can be found at 1.2433, 1.2375 (200-H4 MA).
Anastasia Mileshkina
Similar
What does a new Italian government mean for the euro area?
March election in Italy created a stir as the right-wing Eurosceptic party “League” and the left-wing anti-establishment Five Star Movement got a majority in a Parliament…
Unexpected shake of Malaysian markets
On May 8, Malaysian markets were unexpectedly shaken by news of changes in the Malaysian government…
Popular
EUR/USD: "High Wave" stopped bulls
We've got a bearish "High Wave", which has strong confirmation. In this case, the price is likely going to decline.
Morning brief for May 30
Growing concerns over Greek bailout, early elections in Italy and comments by the ECB President Mario Draghi about the need to maintain the bank’s extraordinary amount of monetary policy support…
CHF/JPY broke powerful resistance level 115.15
CHF/JPY broke powerful resistance level 115…
Deposit with your local payment systems
