The Dollar was on its back foot in the final session of the week, trading lower against most of its developed world rivals, as markets responded to another batch of data that suggests the U.S. economy's pulse weakened early in the second-quarter.
Analyst Joel Kruger at LMAX Exchange says GBP/USD may have reached a key long-term support level at the current 1.26 lows where it could bounce and continue its more constructive longer-term technical picture.
The U.S. Dollar is likely to be supported as regional business surveys remain resilient and U.S.-Sino trade war does not yet appear to warrant a Dollar weakening interest rate cut at the U.S. Federal Reserve say analysts at ING Bank.
The Dollar was riding high, close to the top of the G10 league table and a two-year high, on Thursday but analysts are saying the currency should remain on its front foot at least for the foreseeable future because the U.S.-China tariff fight now risks morphing into an all-out economic conflict.
The Dollar was riding high near the top of the G10 league table Thursday, keeping pressure on the Pound-to-Dollar rate, after minutes from the May Federal Reserve (Fed) meeting further suggested markets might be wrong in betting the U.S. central bank will cut its interest rate before the year is out.
The Pound was steady against a softer U.S. Dollar on Monday but hopes of a steep and protracted rally in the months ahead may be beginning to fade, if the latest analysis from Bank of America is anything to go by, given recent events in Westminster.
From a technical perspective, GBP/USD has established a short-term downtrend which is, on balance, more likely to extend than not given the assumption that the “trend is your friend” and therefore biased to continue.