British Pound Climbs On Optimism About Brexit Deal By Mid-November
MaiMarFX | Oct 22, 2020 04:57AM ET
The best performing currency Wednesday was the British pound which jumped to a high of 1.3177 against the U.S. dollar after European Union chief Brexit negotiator Michel Barnier said a Brexit deal is within reach. The market is confident that a trade deal will be completed by mid-November.
Broad-based dollar weakness contributed to the cable’s upward move.
Let’s have a look at the technical picture:h2 EUR/USD/h2
After refraining from a significant decline below 1.17, the euro was able to gain ground against the U.S. dollar and thus formed a short-term upward trend channel. A next resistance comes in between 1.19 and 1.1920. If the euro climbs above that zone, we expect the pair to test 1.1960 (red ellipse) and maybe even 1.20. If 1.19 however holds we anticipate a dip toward 1.1750 (green ellipse).
The cable broke above its recent downtrend channel and could be heading now for a test of 1.32. Bulls in this pair should watch out for upside breaks above 1.3220 and 1.3270 in order to buy pounds toward 1.34 (red ellipse) or alternatively wait for a confirmation of the current support at 1.30 (green ellipse). However, a decline below 1.2950 could revive bearish momentum.
The Dax broke below its recent upward trend channel and formed a current downtrend channel with a support coming in at around 12400 whereas current resistance zones are seen at 12800 and 12900. If 12400 breaks we may see a drop toward 12200 (green ellipse).
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