result gbp usd :
Last edited by PCMAnalyst; 09-03-2016 at 08:10 AM.
Pound extends loss.
The pound marked fresh three-decade lows amid lingering concerns that Britain's approach towards exiting the European Union could have grave economic consequences.
Many in the market worry that the British government's stance points to a "hard Brexit," in which Britain splits entirely from the single market in favor of retaining control over immigration, which could drive an exodus of banks from London.
The euro was flat at $1.1209 , catching its breath after swinging wildly the previous day.
The common currency had slid on Tuesday to a low $1.1138 before climbing back to a peak $1.1239, along with a rise in euro zone debt yields in response to a report of a European Central Bank plan to taper its asset-purchase program.
The rise in the GBPUSD pair continues on speculation that UK may avoid ‘Hard Brexit’ after PM Theresa May accepted a Parliamentary vote over her Brexit plans.
The latest hourly candle closed above the 1-hr 50-MA level of 1.2311 thus making an old resistance a new support. Cable was offered to a low of 1.2089 levels yesterday on ‘Hard Brexit’ fears and amid broad based US dollar gains.
However, shorts squeeze gather pace in Asia on speculation that the outcome of a parliamentary voter on PM May’s Brexit plans would provide her more tool to negotiate better deals with UK counterparts. The technical correction may continue in Europe and US unless we have fresh newsflow pointing to ‘Hard Brexit’
The break above immediate resistance of 5-DMA level of 1.2369 would open doors for 1.24, above which the pair could target 1.2610. On the other hand, a breakdown of support at 1.2311 would expose 1.2259 and 1.2200.
The British Pound could rally if the government accepts the verdict from the court that to trigger Article 50 requires a vote. However, in the long-run the sell on rallies view remains intact.
Imagine the hypothetical scenario where the government accepts the verdict form the court that to trigger Article 50 requires a vote.
With the UK not in a recession it is hard to see what pressure MPs are under to ignore the result of the referendum. So while we think GBP would rally on such a headline, we would have to remember Article 50 could still pass a commons vote.
The House of Lords may try slow things down but eventually the use of the Parliament Act would get it through. This formality may add another layer of “checks and balances’ but, with the government refusing to show its full hand before reaching the negotiation table, the UK’s demands are likely to remain vague and optimistic. “(i.e. best possible access and so on). So GBP yet again would be a sell on rallies.
UK inflation slips unexpectedly but BoE warns of rises ahead
British inflation slipped unexpectedly last month, but Bank of England Governor Mark Carney warned higher prices are on the way, with cost pressures in factories already ballooning thanks to sterling's Brexit slump.
Annual consumer price inflation weakened to 0.9 percent in October from 1.0 percent in September. Economists taking part in a Reuters poll had expected inflation to rise to 1.1 percent.
But Carney pointed to strong factory-price inflation that probably marks the "first stage" of the impact of the decline in sterling, which is down around 20 percent against the dollar since Britain's June 23 vote to leave the European Union.
The cost of materials and oil for factories showed the biggest monthly jump since records started in 1996, leaping by 4.6 percent in October alone. And prices for goods leaving factories rose by 2.1 percent on the year, the biggest increase since April 2012.
Sterling little changed after UK jobs report
The pound was little changed against the broadly stronger dollar on Wednesday after a report showing that the U.K. unemployment rate fell in the three months to September, but also indicated that the labor market could be slowing.GBP/USD was trading at 1.2451, holding above Tuesday’s lows of 1.2378.
The U.K. unemployment rate ticked down to a new 11-year low of 4.8% in the July-September period, the Office for National Statistics said, compared to forecasts for an unchanged reading of 4.9%.The number of people signing on for unemployment benefits jumped by 9,800 in October and September’s figure was revised up to 5,600 from an initial estimate of 700.
Economists had expected an increase of just 2,000 people.The rate of employment growth also slowed, as just 49,000 people found work in the July-September quarter, the slowest increase since March.Average pay, excluding bonuses, rose by an annualized 2.4% in the three months to September, up from 2.3% in the three months to August.
But pay, including bonuses rose by 2.3%, matching the rate of growth in the three months to August.
Cable attempting to stabilize around 1.2300 ahead of a potential leg lowers to the 1.2090 area.
GBPUSD started to come under more intense downside pressure on Friday and sold off to initial support at 1.2335, the 19th October high. This leaves the market weighing on the downside to start this week and we are looking for a slide to recent lows and near term target remain 1.2090. First it may stabilize around the three month support line at 1.2304, though.
Failure at 1.2083 would mean a continuation of the descent and should trigger losses to the May 1985 low at 1.1855. We regard the recent peak at 1.2674 as the end of the corrective phase and look for further losses. Intraday Elliott counts are suggesting a decline 1.1550.
The pound gave back some of its recent gains as the UK retail sales report simply came in line with expectations of a 0.2% uptick while the BOE was less upbeat than expected. MPC members voted unanimously to keep policy unchanged but warned that adjustments could be made either way, depending on Brexit risks. They added that growth and inflation are likely to be subdued next year.
GBPUSD - 28.12.2016
GBPUSD dropped below 1.2250 levels. GBP/USD declined on Wednesday as sterling was under steady pressure as the UK government heads into negotiations on its EU exit.
Technically, Next immediate support at 1.2195, 1.2117 and 1.2065 levels. Upside resistance at 1.2256, 1.2315 and 1.2380 levels.
Trend overall looking slightly bearish at the moment.
The issue facing market participants was if the rise in hourly earnings reported as part of the pre-weekend release of US December jobs data was sufficient to end the dollar's downside correction. Instead, May's comments over the weekend indicating not just a desire but strategic thrust to abandon the single market in exchange for regaining control over immigration and not being subject to the European Court of Justice has cost sterling more than one percent.