GBP/USD
Having opened the week of 9th November at 1.3157, GBP/USD traveled to 1.3208 on Monday but closed the day only an inch above the open at 1.3163. A steep upside price action followed on Tuesday supported by amendments made to the infamous Internal Market Bill overriding provisions of the Withdrawal Agreement signed by Boris Johnson on January 2020 and mounting hopes of a COVID-19 vaccine. On Wednesday, 11th November cable shot above 1.3300 in the early hours of the day, but then the price climbed down later in the day, finishing at 1.3218. On Thursday, 12th November, the price went yet lower on the back of missed final U.K. GDP target for quarter 3 and closed the day in a long bearish candle at 1.3118. On Friday, the GBP/USD cross rate rose above the 1.3143 daily level on moderately positive rhetoric regarding the Brexit trade deal from the Bank of England’s Governor Andrew Bailey.
The bullish GBP/USD price action in the first two days of the week of 9th November was largely due to the U.K. jobless claims report for October published on Tuesday, registering a 29,800 fall in the number of the claims against the market’s expectation of additional 36,000. Another positive figure that supported sterling on Tuesday was the average earnings for September that was 1.3% against the market forecast of 1.1%. However, Wednesday’s final U.K. GDP report for Q3 showed that the numbers were missed: the YoY GDP for Q3 was -9.6% against the -9.4% market forecast. Along with negative GDP figures, the British September industrial production was 0.5% against the 0.8% market forecast, and YoY manufacturing production was -7.9% against the market forecast of -7.4%. Those figures put substantial selling pressure on GBP/USD, sending the pair below the 1.3143 daily level.
Andrew Bailey positive Friday’s rhetoric consisted in him saying “We are encouraged that Brexit trade discussions are continuing” and “We hope there will be a spirit of goodwill around inevitable disruption after the transition period ends”. His speech let GBP/USD climb in a wavy price action above 1.3143 and close the week at 1.3191.
The week’s price action gives cable bulls much hope of an uptrend continuation. After many weeks, the price has for the first time finished the week above 1.3143, making a good foundation for further bullish price action toward 1.3400. The local resistance level formed by the week’s high at around 1.3270 – 80 may prove an obstacle for GBP/USD but should not hold the price for long. Also, the hopes of a last-minute Brexit deal are getting more real proof, which also increases the market’s buying sentiment.
Currently, the main threat to the U.K.’s economy is the mounting numbers of new COVID-19 cases across the country, 33,470 newly infected – a new high for the U.K. – registered on 12th November. The recent Pfizer and BioNTech’s announcement of their vaccine’s 90% efficacy found in the first interim analysis from a phase 3 study is a light of hope that may reverse the negativity and risks weighing on the British economy.
The next week will be tightly packed with macroeconomic data relevant for GBP/USD. The U.S. retail sales for October will be published on Tuesday, 17th November; the U.K. retail price index and CPI for October and the U.S. building permits and housing starts for October will be published on Wednesday, 18th November. The U.S. jobless claims and home sales statistics for November will be published on Thursday, 19th November. The U.K. retail sales for October will be published on Friday, 20th November.
GBP/EUR
GBP/EUR started off the week of 9th November at 1.1071, rising strongly on the first two days. On Tuesday the cross rate rose to 1.1254 at the day’s peak, having almost reached the 1.1262 daily resistance level, but dipped slightly at the 1.1229 day’s close. The positive economic figures coming from the U.K. on Tuesday – the aforementioned jobless claims and average earnings – were the main stimulus behind the strongly bullish GBP/EUR price action.
On Wednesday, 11th November, GBP/EUR rose to 1.1285, but losing much of the buying volumes, while traders were locking in their profits, the pair finished in a shooting star at 1.1214, providing selling momentum for the rest of the week. On Thursday, 12th November, the price plunged by over 100 price points and closed the day at 1.1113. Besides the bearish-looking Wednesday’s pattern, the selling volumes were increased by the negative U.K.’s final GDP figures for Q3 and the negative U.K. industrial and manufacturing production figures. Friday’s price action for GBP/EUR was a medium-sized bullish candlestick with very small upper and lower wicks, and the pair closed the day and week at 1.1150, providing a solid ground for further gains in the near future.
The week’s price dynamics in GBP/EUR show that the pair’s uptrend is going in full swing: the pair capitalised well above the weekly resistance level at 1.1093, making it support. The positivity shed on the pound by the amendments to the Internal Market Bill made by the House of Lords and by the rhetoric of the Governor of the Bank of England may continue playing into the near future, forming a more positive outlook for sterling.
Besides, the aforementioned economic reports for the U.K., there will be the CPI for October for the eurozone released on Wednesday, 18th November, and the EU consumer confidence index for November, published on Friday, 20th November.
Having opened the week of 9th November at 1.3157, GBP/USD traveled to 1.3208 on Monday but closed the day only an inch above the open at 1.3163. A steep upside price action followed on Tuesday supported by amendments made to the infamous Internal Market Bill overriding provisions of the Withdrawal Agreement signed by Boris Johnson on January 2020 and mounting hopes of a COVID-19 vaccine. On Wednesday, 11th November cable shot above 1.3300 in the early hours of the day, but then the price climbed down later in the day, finishing at 1.3218. On Thursday, 12th November, the price went yet lower on the back of missed final U.K. GDP target for quarter 3 and closed the day in a long bearish candle at 1.3118. On Friday, the GBP/USD cross rate rose above the 1.3143 daily level on moderately positive rhetoric regarding the Brexit trade deal from the Bank of England’s Governor Andrew Bailey.
The bullish GBP/USD price action in the first two days of the week of 9th November was largely due to the U.K. jobless claims report for October published on Tuesday, registering a 29,800 fall in the number of the claims against the market’s expectation of additional 36,000. Another positive figure that supported sterling on Tuesday was the average earnings for September that was 1.3% against the market forecast of 1.1%. However, Wednesday’s final U.K. GDP report for Q3 showed that the numbers were missed: the YoY GDP for Q3 was -9.6% against the -9.4% market forecast. Along with negative GDP figures, the British September industrial production was 0.5% against the 0.8% market forecast, and YoY manufacturing production was -7.9% against the market forecast of -7.4%. Those figures put substantial selling pressure on GBP/USD, sending the pair below the 1.3143 daily level.
Andrew Bailey positive Friday’s rhetoric consisted in him saying “We are encouraged that Brexit trade discussions are continuing” and “We hope there will be a spirit of goodwill around inevitable disruption after the transition period ends”. His speech let GBP/USD climb in a wavy price action above 1.3143 and close the week at 1.3191.
The week’s price action gives cable bulls much hope of an uptrend continuation. After many weeks, the price has for the first time finished the week above 1.3143, making a good foundation for further bullish price action toward 1.3400. The local resistance level formed by the week’s high at around 1.3270 – 80 may prove an obstacle for GBP/USD but should not hold the price for long. Also, the hopes of a last-minute Brexit deal are getting more real proof, which also increases the market’s buying sentiment.
Currently, the main threat to the U.K.’s economy is the mounting numbers of new COVID-19 cases across the country, 33,470 newly infected – a new high for the U.K. – registered on 12th November. The recent Pfizer and BioNTech’s announcement of their vaccine’s 90% efficacy found in the first interim analysis from a phase 3 study is a light of hope that may reverse the negativity and risks weighing on the British economy.
The next week will be tightly packed with macroeconomic data relevant for GBP/USD. The U.S. retail sales for October will be published on Tuesday, 17th November; the U.K. retail price index and CPI for October and the U.S. building permits and housing starts for October will be published on Wednesday, 18th November. The U.S. jobless claims and home sales statistics for November will be published on Thursday, 19th November. The U.K. retail sales for October will be published on Friday, 20th November.
GBP/EUR
GBP/EUR started off the week of 9th November at 1.1071, rising strongly on the first two days. On Tuesday the cross rate rose to 1.1254 at the day’s peak, having almost reached the 1.1262 daily resistance level, but dipped slightly at the 1.1229 day’s close. The positive economic figures coming from the U.K. on Tuesday – the aforementioned jobless claims and average earnings – were the main stimulus behind the strongly bullish GBP/EUR price action.
On Wednesday, 11th November, GBP/EUR rose to 1.1285, but losing much of the buying volumes, while traders were locking in their profits, the pair finished in a shooting star at 1.1214, providing selling momentum for the rest of the week. On Thursday, 12th November, the price plunged by over 100 price points and closed the day at 1.1113. Besides the bearish-looking Wednesday’s pattern, the selling volumes were increased by the negative U.K.’s final GDP figures for Q3 and the negative U.K. industrial and manufacturing production figures. Friday’s price action for GBP/EUR was a medium-sized bullish candlestick with very small upper and lower wicks, and the pair closed the day and week at 1.1150, providing a solid ground for further gains in the near future.
The week’s price dynamics in GBP/EUR show that the pair’s uptrend is going in full swing: the pair capitalised well above the weekly resistance level at 1.1093, making it support. The positivity shed on the pound by the amendments to the Internal Market Bill made by the House of Lords and by the rhetoric of the Governor of the Bank of England may continue playing into the near future, forming a more positive outlook for sterling.
Besides, the aforementioned economic reports for the U.K., there will be the CPI for October for the eurozone released on Wednesday, 18th November, and the EU consumer confidence index for November, published on Friday, 20th November.