GBP/USD is fighting the good fight, with support holding by the hourly cloud top, as the dollar is weakening on more dovish Fed-speak.
GBP/USD is set to end Europe just below Friday's high at 1.2560 as Chicago Fed's Evans nN9N23A011 added to the dovish Fed chorus, noting slowing foreign growth dampening the U.S. economy.
Evans also highlighted growing uncertainties related to global trade disputes.
The pound’s recent strength, despite significant Brexit, economic and political risks, which are likely to keep the BoE from lifting rates any time soon nL9N22Q01U, may be running out of momentum.
It’s true that the Fed has been jawboning rates lower despite better U.S. data.
That said, while talking rates lower the Fed has been flagging global growth and inflation risks.
The UK of all places is not immune to these risks and with substantial trade, regulatory and monetary policy uncertainties rampant with Brexit, when the focus shifts back to the UK, and BoE policy nL8N24D2SC, there seems little room for outsized gains in GBP/USD.
Today's mini-break of 10-DMA resistance at 1.2549 may open the door for a run at 10-WMA resistance by 1.2692, but without Brexit clarity or higher UK rates it is likely GBP/USD bears will make another run at 2019 lows by 1.2409.
GBP Chart: Click here