We are seeing a climb in the dollar ahead of the the Fed Powell’s speech. We have seen a drop in the Conference Board’s Consumer Confidence falling to 84.8 in August making for a sloth paced recovery. We are however seeing hopes for a Coronavirus vaccine grow momentum as Cambridge has been offered funding from the British government.
With the dollar strengthening the pound weakens. With Brexit talks locked at the horns the bulls will have to wear the weight of the pressure coming down on the GBP. Keep an eye on 1.3200 as your first point of resistance with 1.3270 to follow. On the more likely downside you can consider 1.3013 and 1.3050.
Another currency pair finding it hard to crack the ceiling is the EUR/USD. Although trading higher it can’t maintain the trend as the bullish dollar pushes it back. Traders are anticipating that Fed Chair Powell would announce another boost in monetary stimulus. As the pair hovers around the 1.1800 mark it is awfully close to the strong resistance line. A break beyond this can see it head down a slippery slope on a toboggan heading straight to 1.1755 with 1.700 to follow. On the upside consider a resistance level of 1.850 with 1.1900 to follow.