GBP/USD is almost unchanged on Thursday. In early European trading, the pair is trading at 1.2937, up 0.06% on the day. With U.S. markets closed for the Thanksgiving holiday, traders can expect a very quiet day. There are no U.S. releases on the schedule. The sole British event, Nationwide Housing Price Inflation, improved to 0.5%, up from 0.2% in the previous release.
British voters will head to the polls on December 12, and traders should be prepared for volatility from the pound as we get closer to Election Day. Daily poll results are closely watched by investors, and any movement in the parties’ poll standings could quickly affect the movement of GBP/USD.
U.S. Economy Improves in Q3
The U.S economy showed stronger growth than expected in the third quarter. Second-estimate GDP increased at an annual rate of 2.1%, which was higher than the 1.9% estimate. The initial release came in at 1.9%, and analysts had expected that the second estimate would confirm the initial release of 1.9%. Despite the positive release, the U.S. dollar was unable to make much headway against major currencies on Wednesday, and actually lost ground against the British pound.
GBP to USD is showing stronger movement, and the pair punched above resistance at 1.2910 on Wednesday. Is this a sign of an upward trend? GBP/USD is closing in on 1.3000, which has psychological significance. On the downside, we find support at 1.2800. Below, we have the 50-EMA line at 1.2732, which is immediately followed by support at 1.2720.
On the upside, 1.2910 has some breathing room, following losses by GBP/USD on Wednesday. This is followed by resistance at the symbolic number of 1.300. With the GBP/USD appearing content to remain within a narrow range, it could be an uneventful week for the pair.
Pacific Currencies – Summary
USD/CNY is currently trading at 7.0322, up 0.06%. The line of 7.0400 is under pressure but continues to put up stubborn resistance. This is followed by the 50-EMA line at 7.0446. If the pair can break above the 50-EMA, it has some room to move upwards.
AUD/USD is currently trading at 0.6764, down 0.07%. On the fundamental front, Private Capital Expenditure declined by 0.2% in Q3, its third consecutive decline. This points to weakness in business spending, an important driver of economic activity,
NZD/USD has posted small gains on Thursday. Currently, the pair is trading at 0.6425, up 0.10%. The ANZ Business Confidence Index remained deep in negative territory in November, with n reading of -26.4 pts. Still, this was markedly improved from the October release of -42.4 pts.
This article was originally posted on FX Empire
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