GBP price, FTSE news and analysis:
- A downward sloping trendline on the GBP/USD chart is still hampering any potential upside move, while the FTSE 100 continues to trade sideways.
- Positive economic data are encouraging for ‘risk-on’ assets but they are being held back by the surge in coronavirus infections in the US.
GBP/USD testing resistance
Any potential upside for GBP/USD is again being held back by resistance from a downward sloping trendline marking the upper boundary of a channel in place on the charts for the past three weeks. Reinforcing that resistance is the 50-day moving average, which at 1.2404 also stands just above the current price.
GBP/USD Price Chart, One-Hour Timeframe (June 3 – July 1, 2020)
Chart by IG (You can click on it for a larger image)
From a fundamental perspective, markets globally are weighing up some positive economic data against the surge in coronavirus infections in the US. This session, the June purchasing managers’ indexes for the manufacturing sectors in China and Australia both came in above expectations – and above the 50 mark that separates expansion from contraction – and there was also news of a surprise increase in German retail sales in May.
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However, the UK’s Nationwide house price index for May showed its first fall since 2012 and there was more news of job cuts in the UK, this time from the Airbus aerospace company. The protests in Hong Kong against the new security law there are also denting sentiment generally.
As for the FTSE 100 index of the major London-listed stocks, that was little changed in early trading Wednesday, held back like other equity indexes by news that the US has recorded its biggest single-day spike in infections since the Covid-19 pandemic began.
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of clients are net long. of clients are net short.
— Written by Martin Essex, Analyst and Editor
Feel free to contact me on Twitter @MartinSEssex