Daily Market Recap - GBPUSD

The British Pound is rallying against the US Dollar on Tuesday reaching a two-month high of 1.32784 before pulling back slightly. The pair is up 0.66 percent at the time of writing. The GBPUSD is boosted by the prospects of a covid-19 vaccine and a rather upbeat UK employment figures released today.

All the attention on the market has been directed to the potential rollout of a covid-19 vaccine before the end of the year boosting riskier assets and lifting overall investor sentiment. Multiple companies are in the process of developing a vaccine though it seems that Pfizer is leading the race with its mRNA approach and could announce a rollout shortly.

The UK unemployment rate held firm at 4.8 percent, meeting expectations albeit rising slightly from the 4.5 percent reading in the previous quarter. The number of unemployment claims however beat the consensus as well as the average earnings figures to the benefit of GBPUSD bulls.

That said the cable does face some strong headwinds from the Brexit trade deal negotiations which havent improved since the last round of talks. UK Prime Minister Johnson looks set to push through his Internal Markets Bill which would complicate trade talks with the EU. Should negotiations fail to produce a deal, the GBPUSD will likely fall under severe pressure once again.

From a technical perspective, the GBPUSD is gaining positive traction with the daily chart pointing to strong bullish momentum. The RSI remains below the overbought 70 marks which may encourage bulls to push higher towards the 1.32935 resistance level. We can expect strong pushback above that level, however, as sellers may swing the pair back towards the mean as for the moment there isnt much to be that excited about in the Pound.

(Chart Source: Tradingview 10.11.2020)

The likely range for the GBPUSD in the coming sessions should fall between the 1.33438 and 1.3100 level. The immediate support to pay attention to will be the 0.382 Fibonacci retracement level around the 1.31761 marks. A break below should seal the fate of the GBPUSD for further sideways movement.

Disclaimer: This material has been created for information purposes only. All views expressed in this document are my own and do not necessarily represent the opinions of any entity.