British pound supported by the optimism about Brexit

October 24, 2017 1:12 pmComments Off on British pound supported by the optimism about BrexitViews: 71

British poundThe British pound was supported by the optimism about Brexit expressed by the Prime Minister Theresa May. The GBP rose to against the USD to 1.3200, while against the EUR accelerated by 0.25%.

Earlier the UK Prime Minister Theresa May said that she was ambitious and positive about the future of the country and that the current Brexit talks have been conducted in a constructive tone. The market participants seem to see progress in the talks, after some EU leaders expressed confidence that talks could enter in their second phase in December.

The British pound was supported by the comments and recovered from the 11-day bottom against the US dollar. However, later stayed around 1.3220 USD, as the focus shifted to speculation about the next Fed chairman. The traders will be watching with great interest the preliminary data on the United Kingdom’s GDP, which will be released on Wednesday. The results will be an important guideline regarding a possible interest rate increase on the Bank of England (BoE) meeting on November 2nd, with weaker results significantly reducing the chances for it.

After the weak data on Friday, the Canadian dollar depreciated sharply against the basket of currencies. The pair GBP/CAD tested the round price of 1.6680. Even if the price to overcome resistance to the depreciation potential will remain valid. Around today’s levels, and a little above them, there is good option for short position. The chance will be dropped only if we see a significant rise (about 100 pips) above 1.6680, especially if it is due to the rise in the British pound.

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