Market Overview

GBP/USD Forecast: Sterling Rises to December 10 High at Year's End

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GBP/USD Forecast: Sterling Rises to December 10 High at Year's End
  • The GBP/USD rose to 1.2747, the highest since December 10 at the end of the year low liquidity trading.
  • The European Commission President Juncker said the EU is not trying to keep Britain in and wants to start discussing future ties the moment the UK parliament approves Brexit.
  • The US political jitters are set to shut the government offices until a government funding agreement is reached in Congress.

The GBP/USD is trading up 0.3% at around 1.2740, the highest level since December 10 at the last trading day of 2018 as the US government shutdown is weighing on the US Dollar amid low liquidity market.

On the last trading day of 2018, there is no economic data to factor in on the currency market with sentiment driven by the US government shutdown and general political statements on Brexit from the Europen Union officials.

The European Commission President Jean Claude Juncker said in an interview for German newspapers that the EU is not trying to keep Britain in and wants to start discussing future ties the moment the UK parliament approves Brexit, partly to focus on its own unity ahead of May elections. 

“It is being insinuated that our aim is to keep the United Kingdom in the EU by all possible means. That is not our intention. All we want is clarity about our future relations. And we respect the result of the referendum,” Jean-Claude Juncker, told German newspaper Welt am Sonntag over the weekend.

Technically, the GBP/USD broke above broadly based sideways market trend and moved towards mid 1.2700s. The technical oscillators including the Relative Strength Index and Slow Stochastics moved to the upper boundary of the range while Momentum remained stuck in the neutral territory. The break above 1.2700 signals further potential on the upside for GBP/USD to 1.2800 despite low liquidity and low market activity. On the downside, the GBP/USD is set to test 1.2700 first before moving back to the old sideways trend range of 1.2600-1.2700. 

GBP/USD 1-hour chart

gbpusd_1-hour_chart-636818474366915698.png

Posted-In: Brexit EUEarnings News Eurozone Forex Global Markets

 

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