GBPUSD Outlook: Constructive on Speak of Brexit Deadline Extension

GBP worth, information and evaluation:

Speak of an extension of the March 29 Brexit deadline for the UK to go away the EU is strengthening GBPUSD.

It reached a excessive of 1.3095 early Thursday, its strongest stage since November eight final yr, earlier than easing again marginally, and will but lengthen its good points.

GBP worth agency; additional good points doable

GBPUSD hit its highest stage Thursday since early November earlier than easing again a tad. It now appears to be in an excellent place to increase its good points, having climbed above the psychologically necessary 1.30 stage that will restrict any losses.

GBPUSD Worth Chart, Each day Timeframe (September 12, 2018 – January 24, 2019)

Latest GBPUSD price chart pre Brexit.

Chart by IG (You’ll be able to click on on it for a bigger picture)

Sterling’s main driver stays Brexit and it’s benefiting from hypothesis that the so-called Article 50 deadline of March 29 for the UK to go away the EU could possibly be prolonged.

In the meantime, from a technical perspective, the following goal will seemingly be the excessive at 1.3175 reached on November 7 final yr. To the draw back, trendline assist lies at 1.2832 if 1.30 is breached.

Bullish sign from sentiment information

Within the meantime, retail dealer sentiment information present 44.5% of GBPUSD merchants are net-long, with the ratio of merchants quick to lengthy at 1.25 to 1. The variety of merchants net-long is 6.four% decrease than yesterday and 15.1% decrease than final week, whereas the variety of merchants net-short is 17.four% greater than yesterday and 31.three% greater from final week.

At DailyFX, we usually take a contrarian view to crowd sentiment, and the very fact merchants are net-short suggests the GBPUSD worth could proceed to rise. Merchants are additional net-short than yesterday and final week, and the mix of present sentiment and up to date adjustments provides us a stronger GBPUSD-bullish contrarian buying and selling bias.

Extra to learn:

Brexit Timeline Infographic

Brexit Impact on Pound and UK Shares

Utilizing Information and Occasions to Commerce Foreign exchange

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— Written by Martin Essex, Analyst and Editor

Be at liberty to contact me by way of the feedback part under, by way of electronic mail at or on Twitter @MartinSEssex

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