Risk-off sentiment earlier in the week supported the strengthening of the US dollar in Asian session trading today continuing last weekend’s strengthening momentum after US producer price data rose to a 9-and-a-half-year high.
The strengthening US dollar has put pressure on other major currencies in the market after taking the opportunity to rise last week following the dismal performance of the US dollar.
The pound sterling is among the currencies that continue to receive pressure with the strengthening of the US dollar after moving weakly over the past week.
On the price chart of the GBP/USD pair, the price made a decline in the Asian session below the level of 1.37000. Yet after hitting the 1.36700 level, the price rose again at the beginning of the European session above the 1.37000 level again.
Investors will focus on the development of Brexit after the initial report of an agreement between the UK and the European Union (EU) on the issue of Northern Ireland.
The positive development of Brexit has the potential to re -strengthen Pound trading and push the price on the GBP/USD chart back to the SBR (support become resistance) zone of 1.38000.
For a higher rise, the price needs to pass the Moving Average 50 (MA50) barrier on the 1 -hour time frame for a bullish trend signal again.
On the other hand, if the price plummets, the support zone at 1.36000 is seen as a focus destination for the price.
The zone also supported a rebound in prices in early February trading.
Investors are also ready for the release of monthly UK Gross Domestic Product (GDP) data which is expected to increase and support Pound trading.
