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  • The incoming supportive Brexit-related headlines continue to underpin the British Pound.
  • The ongoing downfall in the US bond yields weighed on the USD and remained supportive.
  • All eyes remain glued to the highly anticipated US monthly jobs (NFP) report for September.

The GBP/USD pair quickly reversed a dip to the 1.2300 neighbourhood and is currently placed at the top end of its daily trading range, just mid-1.2300s, albeit strong bullish conviction.
 
The latest leg of a sudden spike of around 40 pips over the past hour or so was led by headlines that the UK PM Borish Johnson has committed to sending an Article 50 extension letter to the European Union. This against the backdrop of the overnight positive development, wherein Tories and the DUP extended support to the PM Johnson’s new Brexit proposal helped the British Pound to regain some positive traction.

Bulls turn cautious ahead of NFP

This coupled with the prevalent selling bias surrounding the US Dollar remained supportive of the uptick. The USD bulls remained on the defensive amid expectations for another interest rate cut by the Fed at its upcoming in October and the expectations were reinforced by the ongoing slide in the US Treasury bond yields to the lowest level since early-September.
 
Traders, however, seemed reluctant to place any aggressive bets, rather preferred to wait on the sideline ahead of Friday’s key release of the official US monthly jobs report, which eventually seemed to be the only factor that kept a lid on any strong follow-through appreciating move for the major.

Technical levels to watch