- GBP/USD takes the bids amid rising expectations of delayed/soft Brexit.
- The opposition Labour party plans to trap UK PM to delay the general election.
- US NFP, Fed Chair’s speech, and the Brexit headlines are in the spotlight.
With the receding chances of no-deal Brexit, the GBP/USD pair stays firm around 1.2330 after witnessing three consecutive positive daily closings ahead of Friday’s UK session open.
The United Kingdom’s (UK) House of Lords is still debating on various Brexit issues to roll them out by Friday evening, in order to return them to House of Commons that could pass them for Royal Assent. While no major change is expected in that front, the British Pound (GBP) traders are more inclined to hear from judicial reviews and pleas against the Prime Minister (PM) Boris Johnson’s prorogation to the parliaments.
It should also be noted that recent resignation by Jo Johnson, a top-tier Tory member, and PM Johnson’s brother, triggered ire against PM Johnson and further favored the odds of a soft Brexit.
Elsewhere, the opposition Labor party leader Jeremy Corbyn is reportedly assumed to play a game of hiding and seek with the UK PM in order to delay the general election till Brexit. The reason, as cited by the Telegraph, is the fear of losing the election.
While the UK’s economic calendar is mostly silent, the United States (US) will offer August month employment data for fresh impulse. Market consensus favors no change in the Unemployment Rate of 3.7% whereas Average Hourly Earnings might step back from 3.2% to 3.1% on YoY while likely being unchanged to 0.3% on MoM. The headline Nonfarm Payrolls (NFP) could weaken to 158K from 164K prior.
Additionally, the US Federal Reserve Chairman is scheduled to speak at an event hosted by the Swiss Institute of International Studies, in Zurich, and hence his comments will be closely observed ahead of the blackout period for the Fed policymakers.
Technical Analysis
Sustained break of the 50-day simple moving average (DMA) requires to be validated by a run-up crossing July 17 low of 1.2382 for further advances, failing to which can recall 1.2200 back to the chart.
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