GBP/USD: Pressured below 1.3800 as UK’s Frost leaves Brussels with disappointment

GBP/USD trims weekly gains while easing to 1.3783, down 0.05% intraday, during Friday’s Asian session. The cable rose to consecutive four days so far  |  15/04/2021 23:40
  • GBP/USD pulls back from seven-day top, drops for the first time in five days.
  • Britain’s Brexit Minister David Frost returns empty-handed from the crunch talks with the EU over NI protocol, trade deal.
  • Market sentiment awaits fresh clues amid US-Russia, Sino-American tussle and cautious sentiment ahead of China data.
  • US Michigan Consumer Sentiment Index can entertain bulls amid a light calendar in the West.

GBP/USD trims weekly gains while easing to 1.3783, down 0.05% intraday, during Friday’s Asian session. The cable rose to consecutive four days so far in the week but has recently stepped back from a seven-day top amid Brexit pessimism as well as a shift in the market’s mood.

During his crunch meeting with European Commission Vice President Maros Sefcovic, UK’s Frost couldn’t solve the riddle over the Northern Ireland (NI) protocol that recently triggered violence in the troubled region. At the end of the meeting, Downing Street said, per Daily Express, "The meeting is part of an ongoing process with the EU to resolve outstanding differences on the Northern Ireland Protocol." It was also mentioned in the news that the bloc is insisting on the full implementation of the protocol, including on a series of NI-GB trade checks.

Other than the NI issue, the region’s push to respond to its legal action over the UK’s unilateral NI protocol acts and the region’s failure to alter the Brexit trade deal treaty also tested the cable buyers off-late. The European Union (EU) took legal action over Britain after it single-handedly altered border-check plans between the UK and Northern Ireland for certain goods.

Elsewhere, some among the bloc’s political fraternity have recently backed Britain over their Brexit demands but hardliners like Germany and France oppose any relaxation and bloc the trade deal. Daily Express said, “Last year's Brexit trade pact is only in force on a provisional basis because the EU has still not fully ratified it. Downing Street has warned it will not allow for any extra time with temporary implementation set to expire at the end of the month.”

It’s worth mentioning that the US sanctions on Russia and China's dislike for American ties with Taiwan as well as intervention in Hong Kong politics also weigh on the risks. Further, cautious sentiment ahead of China’s key statistics, including the Q1 GDP, also challenge the quote’s previous upside moves.

Against this backdrop, S&P 500 Futures wobble around record top while the US 10-year Treasury yields lick their wounds near a one-month low.

Given the strong US-data-backed run-up by the GBP/USD the previous day, coupled with a lack of major data/events from the UK, today’s US Michigan Consumer Sentiment details will be closely observed for fresh direction.

Read: US Michigan Consumer Sentiment April Preview: Happiness is on the way

Technical analysis

A confluence of 21-day and 50-day EMA EMA probes short-term buyers around the 1.3800 threshold, a break of which will highlight a descending resistance line from March 18, near 1.3870. Meanwhile, GBP/USD sellers are less likely to take entries until the quote stays above the 100-day EMA level of 1.3670.

 

Share

Popular News

Show More Popular News

TheFXApp's Views

TheFXApp analyses will provide both fundamental and technical comprehensions on finance
and other asset classes for TheFXApp viewers

Back

Login to TheFXApp Account

Your TheFXApp account gives you access to the tools that we offer our customers including our
Technical Studies & Sentiment for your accounts.

Forgot Password?

Don't you have a TheFXApp account? With a few easy steps you can easily register to TheFXApp

Create a TheFXApp's Account

Your TheFXApp account gives you access to the tools that we offer our customers including our Technical Studies & Sentiment for your accounts.

register_ty

Thank you!

Welcome to TheFXApp family!

You have succesfully completed the registration.
We will send you an e-mail to give you some
instructions and our Terms and Conditions!
Our account representatives will be contacting you as
soon as possible. If you have any further questions
please do not hesitate to mail us via info@thefxapp.com