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The pound continues to trade in a weak manner but what should give some hope to the bulls is the fact that despite the weakness, the pair had managed to stay above the 1.40 region over the last few days and the strength of the dollar has not been able to generate enough momentum for the pair to move below the 1.40 region so far.
GBPUSD Still Clinging to Support
It has been a string of holidays in Europe over the last few days and hence the volatility and the liquidity has been low. So, it is only quite expected that there would be a lot of consolidation during this period. It is only today that most of the traders and investors are likely to return back to their desks after the very long weekend and the liquidity should slowly begin to pick up today and this should see the pair being challenged and under pressure during this time.
It would be interesting to see how the pound reacts under such circumstances and whether the bulls would continue to be able to hold the prices above the support region for today. The region around 1.40 is expected to be a battle ground between the bears and the bulls as a move below this support region would mean that the bears are back in control. The pound ha been generally buoyant due to the smooth progress of the Brexit process so far which has received some good support from all quarters as we have less than a year too go for the Brexit process to complete. The incoming data has also not weakened too much during this period.
The manufacturing PMI data would be released from the UK during the course of the day but there would be not much data from the US. The fall in the US stock markets is likely to be replicated in the other markets as well and hence the pound could turn out to be strong and buoyant during the course of the day.
This article was originally posted on FX Empire