The Pound-Dollar Rate Corrects Lower Monday but Tipped as a Buy at Major Bank

The Pound-to-Dollar rate retreated from technical 'resistance' level on the charts Monday amid a sell-off in risk assets, at the beginning of what promises to be an action-packed week for Brexit and central banking news, although the exchange rate has been tipped by some to rise over the coming days. 

The Pound-to-Dollar rate is set to begin trading around 1.2485 at the beginning of the new week after closing the previous one around 1.68% higher on Friday and studies of the charts suggest the pair has established a new uptrend that could take it higher in the days ahead. 

The Pound-to-Dollar rate rallied in morning trading Friday amid speculation that a shift in the UK government's stance on Brexit is afoot, with the move taking Sterling close to 'resistance' provided by a key 'pivot point' on the charts, which risks proving insurmountable for the British unit. 

The Pound stalled in its advance against the Dollar Wednesday and looked on course for its first daily loss this week as investors bid for the greenback in response to an apparent olive branch offered by China to the U.S., although some analysts are tipping the British currency for further gains up ahead. 

The time spent above by the GBP/USD exchange rate above 1.2305 suggests Sterling is “holding its ground” on an “improving outlook,” says Richard Perry an analyst with Hantec Markets.

The Pound-to-Dollar rate could continue to trade around its Monday level until year-end, new upgraded forecasts from BMO Capital Markets suggest, after parliament appeared to have prevailed in its push to force the Prime Minister into requesting another extension of the Article 50 negotiating window. 

GBP/USD has shown strength in previous week, suggesting possibility of continuation higher.

The Dollar extended earlier losses Friday after a mixed non-farm payrolls report feuled speculation that economic conditions will soon force the Federal Reserve (Fed) to indulge markets with multiple interest rate cuts, which has further incited a rally in so-called risk assets.