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Forex Daily Recap – British Pound under Pressure over Boris Win

Nikhil Khandelwal

GBP/USD

The Cable kept the plunge rally intact as Boris Johnson becomes the next UK Prime Minister. Johnson won 66% of the votes – 92,153, to Hunt’s 46,656. Now, Britishers fear Johnson to execute a hard Brexit in order to make the UK-EU divorce happen on/before October 31 deadline. Several UK Ministers and Officials who strongly disagree for a hard Brexit have already displayed their stance, proclaiming to resign from the office in such a case. The 50-day SMA has moved and crossed below the significant long-term SMA, developing strong Death Cross signals. The Relative Strength Index (RSI) remained stagnant near 38 level throughout the day. In the meantime, BoE Chief Economist Andy Haldane proclaimed that he would resist for any near-term monetary policy loosening until and unless the economy was witnessing a sharp downfall.

GBPUSD 60 Min 23 July 2019

“Monetary policymakers are often cast as one-club golfers. In the current conjuncture, the problem is more, that the MPC does not know which of two quite different fairways it should be aiming at,” said Haldane. “With the economic road ahead potentially forking, the case for holding rates until the road becomes clearer is strong.”

EUR/USD

The Fiber had maintained a consolidation mode until the last day’s North American session within 1.1207/27 range level. Anyhow, the EUR/USD pair lost the ground of such sustained price action, slipping to 1.1151 bottom mark. All the significant SMAs stood well above the pair to prevent any immediate upside price actions. However, the pair was forming a symmetrical triangle even at this level, hinting for a downtrend continuation. Quite shockingly, the RSI dropped even the lowest 16 mark on Tuesday’s trading session. Earlier the day, the ECB addressed in its Bank Lending Survey that the loan demand would soar in the third quarter. Despite that, the Central bank added that corporate lending and mortgage credit standards would remain unchanged.

AUD/USD

AUDUSD 60 Min 23 July 2019 (2)

The 50-day near-term SMA was crossing and moving below the 100-day SMA. Such a Death Cross condition allowed the Aussie pair to shed most of its accumulated gains over the last few weeks, earlier this month. Also, the technical indicators revealed the intensity of this sour sentiment with the RSI indicating around 34 level. Such an RSI mark calls for an oversold condition that dragged the price actions downwards. Anyhow, the robust 0.6996 resistance acted as a firm cushion on the downside, limiting potential losses.

USD/CAD

The Loonie pair continued to extend the previous day’s trading session into today’s session. After marking the day’s opening near 1.3129 level, the pair kept the positive trend intact in the later hours. Meanwhile, 1.3164 resistance had put a lid over the pair’s daily positive movements. The pair hardly showed any adverse growth in the last few sessions. However, if at all, the pair moved downside, the SMA conflux consisting of the significant SMAs would have got activated.

USDCAD 60 Min 23 July 2019

Also, today, the UK oil traders were looking up for new peaceful ways to carry oil tankers through the Strait of Hormuz.  The Crude prices shot up 1% today undermined the rising Middle tensions, aiming to put a threat on the demand side. The pair gradually moved north side, taking slight intermediate halts near an ascending slanting support line.

This article was originally posted on FX Empire

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