GBPUSD, like the rest of the currency markets yesterday, had a very slow day and there was not much movement and we saw some consolidation and ranging for most part of the day. There was nothing fundamental to drive the markets in any direction and this was one of the main reasons for the volatility to be low. The news over the weekend was also not much and with no economic events or data lined up yesterday, the traders probably stuck to position adjustment and sitting on the sidelines as the better option.
GBPUSD Looks Weak
The pair has been finding it hard to break back through the 1.29 region once again, after falling through it on Friday. The strong NFP report helped to bring in some steadiness in the dollar since Friday and this pushed the pair below the 1.29 mark. Considering the fast and adverse reaction of this pair to the strength in the dollar, it can be safely said that the pound continues to be one of the weaker currencies out there and the traders and investors in the pound continue to be jumpy about what the future might hold.
This is quite understandable considering the fact that the Brexit negotiations are yet to hit full throttle. We also have the occasional calls for the resignation of the UK PM May as a fallout of the UK election results and this is not an ideal situation for the UK economy, especially at this juncture and this is borne out in the weakness of the pound and its inability to move higher, especially through the 1.3030 region which has been acting as a strong ceiling over the last several weeks. We expect this weakness to continue in the short and medium term as things begin to become more clear with respect to the Brexit negotiations and we come to know which side gains the most from it.
Looking ahead to the rest of the day, there are no economic events or data lined up for the day but the traders would be looking forward to a bit more volatility starting today and we expect the GBPUSD pair to be under pressure with 1.3030 continuing to weigh on the pair.
This article was originally posted on FX Empire