British Pound Stays Strong Whilst The Dollar Remains Weak
The British pound remained strong in early trading this week, especially so versus the US Dollar which remains weak and is consolidating around its recent lows.
GBPUSD has managed to trend higher this last month and is now back at the levels seen in early July. There could be some resistance around the 1.31 to 1.32 level above the price. This range was roughly the lows and consolidation areas during the early summer months.
However with Brexit still at the forefront of all news the British Pound could still gain some further ground yet. We are entering a crucial time for the Brexit negotiations with the Ireland border being one of the hot topics over the coming weeks, and that’s before the negotiations on trade come into play.
Weakness in other major currencies has also aided GBP’s strength. As we said earlier, the US Dollar is languishing at lows for the year, the Japanese Yen has been in constant freefall too, along with the Australian Dollar and New Zealand Dollar. If some of these currency trends change it could put some pressure on the British Pound and curb any further gains in the short term.
Today in the UK we have CPI data released at 9:30 AM and on Thursday morning we have retail sales data. Both sets of data have the potential to move the British Pound rate so we would expect some volatile trading as we move into the end of this week.
Pete Southern is an active trader, chartist and writer for market blogs. He is currently technical analysis contributor and admin at this here blog.
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