GBP/USD geared to take another run at 1.33 if Brexit hope holds
The GBP/USD heads into Friday's London market open sitting just below recent swing highs, with Thursday's peak of 1.3298 sitting close by.
This week has seen a resurgence in market risk appetite as traders shake off trade war fears and investor sentiment improved regarding Brexit, with hopes beginning to edge once again into higher territory that a workable solution will be reached. headlines late in the day on Thursday and continuing into the Friday overnight session threw that confidence into question though, as the EU and the UK remain miles apart on several key points, mainly the lack of a solution on the Irish border problem, and the workability of a trade regime within the UK, and failure from the two sides to reach an agreement by the end of October will see the UK careening into a messy and disorderly Brexit.
On the economic calendar little of note exists to carry the GBP through to the weekend, though 08:30 GMT will be seeing the UK's Public Sector Net Borrowing for August, which is expected to remain relatively steady, forecast to come in at £2.85 billion (last £2.872 billion), while the USD side of the major pair will be seeing US Markit PMIs at 13:45 GMT, with the headline preliminary Composite CPI for September expected to tick up to 55.0 after last coming in at 54.8.
GBP/USD levels to watch
The Sterling's recent bullish move up has left the GBP/USD poised for further gains, yet moderately overextended, and a pullback could be in order before bulls manage to finish the run to 1.33; as FXStreet's own Valeria Bednarik noted, "in the 4 hours chart, the pair broke through a major Fibonacci level with a long candle, a sign of strong buying interest, with the 20 SMA now hovering near the mentioned Fibonacci support at around 1.3170. Technical indicators in the mentioned chart have lost upward strength and are currently flat in overbought territory, without indicating a possible upcoming decline, but rather suggesting a new leg higher for this Friday."
Support levels: 1.3225 1.3170 1.3130
Resistance levels: 1.3295 1.3330 1.3380