Markets, investors, traders and many more are all waiting for the much-anticipated speech by Fed Chair Jerome Powell, that is to speak today at 14:00 GMT at the Jackson Hole Symposium. Traders will be tuning in to see if they can pick point any hints about further monetary easing in the US. At the time, things are very wishy washy. The last FOMC minutes from July were published on Wednesday. The minutes had a hawkish tone, stating that the July rate cut by 25 basis points is simply a mid-cycle adjustment. Several policy makers, since then, have made comments that they may not be supporting of another rate cut in September, including a comment from Rosengren on Monday stating that the US is in good shape and that the United States does not need to cut rates on the basis of other countries weaknesses.
Let’s shift our attention to the British Pound and Brexit. What’s the main thing holding up Brexit negotiations? The backstop. What exactly is the backstop and what are the latest developments? I’ll tell you.
The backstop relates to the border between Northern Ireland which is a part of the UK and the rest of Ireland which is part of the EU. The thing is that, as part of the 1998 Good Friday Agreement, which was a major political development in the Northern Ireland peace process, security checkpoints were removed from the Irish border. This was an important sign of goodwill that helped to bring a peace treaty and ended years of conflict between the 2 sides. Now there are fears, that if a hard border is implemented, it may open old wounds and spark renewed conflict.
Well, the backstop, is sort of an agreement or an insurance policy that states regardless of what happen with the rest of the negotiations, there won’t be a hard border.
PM Boris Johnson met with German Chancellor Angela Merkel on Wednesday and he said he was encouraged by her “can do spirit”. Merkel expressed that it is possible to reach a new deal before the deadline. He also met with President Emmanuel Macron on Thursday, but Macron did not sound as optimistic, stating that he does not think a new deal can be proposed before the 3rd deadline for Brexit on the 31st of October.
Johnsons optimist and the spark of a possibility that a deal may indeed be reached gave ground for bullish momentum that stalled at 1.22731. This level coincides with our respected local trend line down on a Daily TF for GBP USD.
The pair is now also waiting for Mr. Jerome Powell. If the FED hints at more easing, the pair may rise with target areas at 1.22886 (23.6% Fibo), followed by 1.24583 (38.2% Fibo) and then 1.25954 (50% FIbo).
If on the other hand the FED fails to confirm the now largely anticipated rate cut in September the pair may continue to sail down below the strong level of support in the area between 1.21607 and 1.21110, further down will take us to the 2019 low of 1.20143. Further targets to the downside can be at 2016-2017 lows in the area of 1.19860 and 1.19048.
Let’s shift our attention to the British Pound and Brexit. What’s the main thing holding up Brexit negotiations? The backstop. What exactly is the backstop and what are the latest developments? I’ll tell you.
The backstop relates to the border between Northern Ireland which is a part of the UK and the rest of Ireland which is part of the EU. The thing is that, as part of the 1998 Good Friday Agreement, which was a major political development in the Northern Ireland peace process, security checkpoints were removed from the Irish border. This was an important sign of goodwill that helped to bring a peace treaty and ended years of conflict between the 2 sides. Now there are fears, that if a hard border is implemented, it may open old wounds and spark renewed conflict.
Well, the backstop, is sort of an agreement or an insurance policy that states regardless of what happen with the rest of the negotiations, there won’t be a hard border.
PM Boris Johnson met with German Chancellor Angela Merkel on Wednesday and he said he was encouraged by her “can do spirit”. Merkel expressed that it is possible to reach a new deal before the deadline. He also met with President Emmanuel Macron on Thursday, but Macron did not sound as optimistic, stating that he does not think a new deal can be proposed before the 3rd deadline for Brexit on the 31st of October.
Johnsons optimist and the spark of a possibility that a deal may indeed be reached gave ground for bullish momentum that stalled at 1.22731. This level coincides with our respected local trend line down on a Daily TF for GBP USD.
The pair is now also waiting for Mr. Jerome Powell. If the FED hints at more easing, the pair may rise with target areas at 1.22886 (23.6% Fibo), followed by 1.24583 (38.2% Fibo) and then 1.25954 (50% FIbo).
If on the other hand the FED fails to confirm the now largely anticipated rate cut in September the pair may continue to sail down below the strong level of support in the area between 1.21607 and 1.21110, further down will take us to the 2019 low of 1.20143. Further targets to the downside can be at 2016-2017 lows in the area of 1.19860 and 1.19048.