- GBP/USD wavers following its pullback from 1.3140 on broad US dollar strength.
- Risks struggle for a clear direction even as Democrats are leading the presidential race.
- UK Services PMI and US data can entertain traders amid a long night before the final results.
GBP/USD drops to 1.2991, down 0.27% intraday, while heading into Wednesday’s London open. The Cable earlier surged to 1.3140, before bouncing off 1.2934, as updates from the US election polls keep the hopes of a blue wave on the table.
US President Donald Trump takes the lead in Florida but his rival Joe Biden has more seats, above 220, than his own 150+ mark. The same keeps the market players looking for a clear Democratic victory in the US houses, mostly cheered as a blue wave.
US presidential candidate Biden recently crossed wires while saying, “On track to win this election, urges patience until all votes counted.” Though, the final results will take longer, expected till Friday-end, to get the confirmation.
As a result, the US dollar index (DXY) benefits from the risk-off mood while printing 0.50% intraday gains. The trading sentiment alternatively challenges S&P 500 Futures while it keeps the recent gains around 3,400.
Check live updates: Four more years for Trump or a victory for Biden? – Live coverage
Looking forward, GBP/USD traders may take intermediate clues from the final reading of October month Services PMI, initial forecast 52.3, ahead of the US ADP Employment Change and US Services PMI for the stated month.
Read: ADP Employment Survey Preview: Sector recovering at a slower pace
It should, however, be noted that the path to the White House is getting clearer for the Democrats and hence challenges to the US dollar are ahead. Though, Brexit woes and the coronavirus (COVID-19) conditions in the UK and Europe can keep the Sterling buyers challenged.
Technical analysis
GBP/USD traders eye a 100-day EMA level of 1.2890 as nearby support ahead of challenging a multi-day-old support line near 1.2880/75. On the contrary, bulls will be confident above 1.3140.
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