GBP/USD eases towards 1.3050 ahead of key UK/US data

• GBP/USD weighed down by broad US dollar strength.
• Brexit talks resumed, differences on key issues still persist.
• Brexit, stimulus updates and key UK/US data in focus.

GBP/USD is on a steady decline so far this Friday but holds above the 1.3050 level, as the US dollar remains broadly underpinned following the conclusion of the final Presidential election debate.

The spot extends its retreat from six-week highs of 1.3178 into a second day, mainly pressured by the resurgent demand for the US dollar across its main peers.

Despite some signs of progress in the US fiscal stimulus talks, the greenback drew bids on the back of upbeat US jobless claims and existing home sales data. Meanwhile, rising coronavirus cases globally kept the investors on the edge, benefiting the safe-haven dollar.

Meanwhile, the pound remains little impressed by the resumption of the Brexit talks after EU’s Chief Negotiator Michel Barnier arrived in London to meet with his British counterpart David Frost. Differences still remain on major issues such as fisheries, state aid and scientific collaboration.

The UK CBI Industrial Trends Survey on Orders improved to -34% in October vs. September’s -48%, limiting the declines in the cable. Attention now turns towards the UK Retail Sales and Preliminary Markit PMI reports due later in the session ahead for fresh incentives on the prices.

GBP/USD technical levels

“The 14-day relative strength index is still holding above 50 (in bullish territory). Similarly, the positive MACD histogram shows the path of least resistance is to the higher side. As such, the pair could reverse losses during the day ahead. On the way higher, the pair may encounter resistance at 1.3174, followed by 1.3267 (Aug. 19 high). On the downside, support is seen at 1.3011 (50-day simple moving average). At press time, the pair is trading at 1.3068,” FXStreet’s Analyst Omkar Godbole noted.

GBP/USD additional levels