- GBP/USD fails to entertain traders amid the Christmas holidays, a lack of major drivers elsewhere.
- Fears of hard Brexit exert downside pressure on the pair, downbeat USD performance keeps the declines limited.
GBP/USD portrays the lull market conditions by trading in a range between 1.2948/35, clinging to 1.2944 by the press time, during early Tuesday.
The Irish Prime Minister Leo Varadkar’s comments that UK PM is embarking on a “harder Brexit than we anticipated” boost the fears of a hard Brexit off-late. Earlier, the EU leaders’ worries for the tough discussions and concerns surrounding German Pharmacy in case of a hard departure weighed on the cable.
The UK PM Boris Johnson’s statements like “this will be with no alignment on EU rules”, about the EU (Withdrawal Agreement) Bill, initially escalated the Tory leaders’ firm commitment to press the region towards his terms after a major election victory.
On the other side, Chinese rant for the US interference in issues concerning Taiwan, Hong Kong and Xinjiang highlight fears of US-China tussle despite recently agreed on phase-one.
Even so, the absence of major data and holidays at the key bourses keep price moves limited. Though, traders can take clues of the mild US dollar (USD) weakness ahead of the US Richmond Fed Manufacturing Index for December, expected +9 versus -1 prior.
Technical Analysis
A confluence of 50-day Exponential Moving Average (EMA) and 38.2% Fibonacci retracement of September-December upside, around 1.2925/20, limit the pair’s downside. Alternatively, 1.3000 round-figure and 23.6% Fibonacci retracement level near 1.3150 can question short-term buyers.
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