Sterling Remains in Favor but US NFPs and PMIs Loom Large
- GBPUSD should re-test 1.3000 and maybe higher but US data may crimp price action.
- UK PM Johnson with a 17-point lead in the polls according to one survey.
Brand New Q4 2019 Sterling Forecast and Top Trading Opportunities
Sterling continues its good run this week as is likely to have another run at 1.3000 against the US dollar. The market will be quiet this morning ahead of the monthly US Labor report and the important US ISM numbers with the manufacturing print especially important after last month’s heavy fall. For a full rundown of all market moving economic data and events please see the DailyFX Calendar.
The UK manufacturing PMI is also released this morning and is expected to remain weak (48.3 vs. 48.3 in September)
Early opinion polls released Thursday showed UK PM Boris Johnson with a commanding 17-point lead over Labour with some pollsters opining that the Conservatives would have a 50/60 seat majority in Parliament. US President Trump also weighed in yesterday saying Boris Johnson Good/Jeremy Corbyn Bad and that he expected a huge trade deal with the UK, although some parts of the current withdrawal Agreement may cause problems.
GBPUSD is trading around 1.2960 and recent price action points to growing underlying strength in the British Pound. This week dips have been bought and 1.3000 and the recent multi-month high at 1.3013 and the early May peaks around 1.3177 are the next upside targets. Support remains firm between the 61.8% Fibonacci retracement at 1.2838 and a cluster of 1.2815. The market is expected to be quiet ahead of the US data.
GBP/USD Daily Price Chart (January – November 1, 2019)
IG Client Sentiment shows that how traders are positioned in a wide range of assets and markets.
Traders are currently 51% net-short GBPUSD, a bullish contrarian bias.