A Doubtlessly Unstable Cocktail of Heavyweight Information and Politics

GBP/USD Value, Chart, and Evaluation

  • UK knowledge will steer Sterling within the quick time period.
  • ‘Operation Save Large Canine’ plans revealed.

Hold updated with all market-moving knowledge releases and occasions through the use of the DailyFX Calendar

A gradual begin to the week with the US celebrating Martin Luther King Day will seemingly decide up for cable merchants with a bunch of heavyweight financial knowledge releases set to be launched. On Tuesday the most recent jobs and earnings knowledge (November), Wednesday sees the discharge of the December inflation numbers, whereas on the finish of the week the most recent have a look at the UK excessive avenue with December retail gross sales report. All three releases have the potential to maneuver Sterling and needs to be intently watched.

UK Prime Minister is ready for a probably tough week forward with the publication of the findings of senior civil servant Sue Grey’s ‘partygate’ investigation. UK PM Boris Johnson is underneath rising stress to resign from some inside his personal occasion, whereas others are rallying across the PM and giving him public statements of assist in a coordinated effort referred to as ‘Operation Save Large Canine’. Whereas particulars stay sketchy, it appears seemingly that some senior civil servants will lose their jobs over the lockdown-breaking events in an try to shore up assist for the PM.

GBP/USD broke by way of the medium-term downtrend final week with relative ease and traded at a contemporary multi-week excessive of 1.3750 final Thursday earlier than fading decrease. Whereas Sterling is at present robust, a number of the latest strikes in cable have been prompted by the modifications in worth of the US dollar. Going into the yr, market positioning for the US greenback was closely lengthy on elevated expectations of financial tightening within the US grew. The buck has weakened of late nonetheless as a few of these lengthy bets have been unwound, permitting cable to press additional forward. The greenback appears to be like to have a stage of assist and GBPUSD is now prone to be moved by UK knowledge and politics moderately than by US financial coverage expectations. Cable has respectable assist all the way in which again right down to 1.3570, whereas the late-October triple excessive at 1.3835 might show a tough hurdle to beat within the quick time period.

GBP/USD Every day Value Chart – January 17, 2022

British Pound (GBP): A Potentially Volatile Cocktail of Heavyweight Data and Politics

Retail dealer knowledge present 40.46% of merchants are net-long with the ratio of merchants quick to lengthy at 1.47 to 1. The variety of merchants net-long is 8.54% greater than yesterday and eight.88% decrease from final week, whereas the variety of merchants net-short is 5.11% greater than yesterday and 6.67% greater from final week.

We usually take a contrarian view to crowd sentiment, and the actual fact merchants are net-short suggests GBP/USD costs might proceed to rise. Positioning is much less net-short than yesterday however extra net-short from final week. The mixture of present sentiment and up to date modifications offers us an additional blended GBP/USD buying and selling bias.

What’s your view on GBP/USD – bullish or bearish?? You may tell us by way of the shape on the finish of this piece or you may contact the writer by way of Twitter @nickcawley1.

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