- GBP/USD turned positive for the second straight session amid renewed USD selling bias.
- Hopes for more US fiscal stimulus, dovish Fed expectations continued weighing on the USD.
- Investors now eye US ADP report for some impetus ahead of the FOMC meeting minutes.
The USD witnessed some fresh selling during the early European session and pushed the GBP/USD pair to two-day tops, around mid-1.3600s.
The pair quickly reversed an intraday dip to sub-1.3600 level and moved into the positive territory for the second consecutive session on Wednesday. The uptick also marks the fifth day of a positive move in the previous six and was exclusively sponsored by the emergence of some fresh selling around the US dollar.
As investors await the results of a US Senate runoff elections in the state of Georgia, increasing bets on a Democrat victory raised expectations for additional US financial aid package. A Democrat-led Senate will have a big impact on the incoming US President Joe Biden’s ability to pursue his preferred economic policies.
Apart from this, hopes for a strong global economic recovery in 2021 remained supportive of the underlying bullish tone in the financial markets. This, along with speculations that the Fed will keep rates lower for a longer period undermined the safe-haven greenback and further extended some support to the GBP/USD pair.
Bulls seemed rather unaffected by concerns about the economic fallout from the imposition of a third nationwide lockdown in the UK, which might have raised prospects for additional policy easing by the Bank of England. Nevertheless, the USD price dynamics remains an exclusive driver of the GBP/USD pair’s intraday positive move.
Hence, the key focus now shifts to the latest FOMC monetary policy meeting minutes, scheduled for release later during the US session. In the meantime, the US economic docket – highlighting the release of ADP report on private-sector employment – will be looked upon to grab some short-term trading opportunities.
Technical levels to watch
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