Daily Market Recap - GBPUSD

The British Pound is trading lower against the US Dollar on Thursday after failing to break above the 1.34 resistance mark earlier in the day. The pair retreated towards the 1.33 level where it found some support preventing it from dipping further.

The Pound is having a lackluster performance in todays thinly traded Thanksgiving session, snapping the bullish momentum after setting a twelve-week high yesterday. The GBPUSD managed to score eight bullish candlesticks in the past nine but could not add to its tally today.

A rebounding greenback and relatively quiet economic calendar contributed to the overall uneventful trading session today in the Pound. A mixed bag of underlying pressures in the GBPUSD is to keep investors on edge and speculating over the probability that the pair will break above the 1.34 level in the short run.

Brexit news continues to dominate the minds of GBP traders with the latest comments from the European Commission President Ursula van der Leyden reiterating the ongoing stalemate in negotiations. The EU chief warned that the trade deal is still far from certain given the UKs uncompromising stance on fisheries.

On the other side of the Channel, UK‘s finance minister affirmed a Brexit trade deal can still be reached through tangible signs of progress that remain to be seen at the time of writing. The market’s muted reaction to his comments come as a vindication to traders who remain unconvinced.

The GBPUSD will continue to face headwinds during its trade deal negotiation progress and will be highly impacted by the outcome thereof. Brexit headlines will likely be the main source of price movement in the pair for the coming sessions.

From a technical perspective, the GBPUSD met strong resistance at the 1.34 mark and may begin a downward correction towards the 1.32 mark. Price action in the run-up to that point will give traders an indication of whether a reversal to the upside may take place. The likely short term range on the GBPUSD should fall between the 1.35 December 2019 high and the 1.32 secondary support channel.

(Chart Source: Tradingview 26.11.2020)

For now, the trend on the GBPUSD remains up on the daily chart and overall market optimism around a faster global economic recovery thanks to a covid-19 vaccine could help buoy the Pound until we get a clearer picture on the outcome of the Brexit trade agreement.

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.