- Buyers keep targeting 1.2965/70 amid broad USD pullback.
- Cross-party Brexit talks in the limelight.
The GBP/USD pair is on the bids around 1.2930 while heading into the London open on Monday. Lack of market support for the US Dollar (USD) continues to highlight 100-day and 200-day SMA confluence ahead of the cross-party Brexit talks resume in the UK.
The greenback failed to please buyers on Friday after consumer spending missed the mark inside upbeat US GDP growth for Q1 2019.
Also adding to the USD weakness could be an absence of positive headlines from the US-China and US-Japan trade negotiations.
It can also be said that market risk tone turned heavier recently and the same took some US Dollar gains off to safe-havens. Global barometer of risk sentiment, the US 10-year treasury yields, slipped three basis points to 2.5% during Friday but is unchanged since early today.
While halt in cross-party talks could be considered as one of the reasons why the British Pound (GBP) declined after Easter break, resumption of the same Brexit discussions can play positively for the Cable buyers.
Both the headline parties, namely the ruling Tories and the opposition Labour, are putting their bets forward ahead of May 23 EU election in order to please voters in case Theresa May fails to submit the formal Brexit requite by then.
Some among the Labour party are showing the second referendum as their manifesto while conservatives want to get rid of PM May’s negative image (or herself from the PM position) in order to lead the rule forward.
Irish backstop and EU customs region are likely the major barriers that stop the parties from agreeing with each other.
The US personal spending and income data become the only statistics on the economic calendar to watch for now. March month personal income is expected to rise by +0.4% from +0.2% prior whereas two readings of personal spending namely for March and February should be compared to January month’s +0.1% advance.
Technical Analysis
Unless declining beneath 1.2860, buyers can keep targeting 100-day and 200-day simple moving average (SMA) confluence near 1.2965/70 ahead of looking at 1.3000 and 1.3030 resistance levels.
Meanwhile, 1.2830 and 1.2770 may entertain sellers past-1.2860 while 1.2700 seems strong support to watch afterward.
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