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Denis Sergienko • 2022-12-22

GBPUSD bulls ignore downbeat UK GDP amid market’s positive mood

GBPUSD bulls ignore downbeat UK GDP amid market’s positive mood

Traders stay on the way to consolidate BOJ-led losses amid the risk-positive headlines from China and a retreat in yields. Adding strength to the risk-on mood could be a light calendar and the market’s year-end positioning.

With this, the US Dollar extends the previous day’s losing streak and allows major currency pairs to remain firmer. Among them, AUDUSD gains the most, mainly due to its links with China, whereas USDCAD occupies the other end due to a pullback in oil prices. Further, GBPUSD marks a notable upside despite the downbeat UK GDP and medical workers’ strikes in Britain.

Gold remains mildly positive while Brent oil struggles after posting the biggest daily gains in more than a week.

BTCUSD and ETHUSD remain indecisive despite the softer USD as one more industry player files for bankruptcy.

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Following are the latest moves of the key assets:

  • Brent oil grinds near one-week high surrounding $82.50, printing mild gains of late.
  • Gold also seesaws around $1,815 as bulls await more clues to tighten the grip.
  • USD Index drops for the second consecutive day, down 0.35% intraday near 103.90 at the latest
  • Wall Street closed with notable gains and allows stocks in the Asia-Pacific region, as well as in Europe and the UK, to remain mostly positive.
  • BTCUSD and ETHUSD remain indecisive around $16,800 and $1,200 in that order.

Risk-on mood favors traders

China’s State Council, the securities regulator and the People’s Bank of China (PBOC) all braces for pro-growth policies, as per Bloomberg, which in turn weighed on the US Dollar’s safe-haven demand. Also exerting downside pressure on the greenback could be the downbeat yields and mixed data that couldn’t impress Fed hawks of late.

As a result, the USD weakness allowed majors to stay firmer despite mixed updates surrounding Russia and Europe.

Yields were down for the second consecutive day whereas stocks in the Asia-Pacific and the West appear positive. The same help gold to defend the bulls even as crude oil fails to cheer softer USD and hopes of more demand due to fierce winter, as well as heavy travel, expectations.

On the other hand, the talks of Bitcoin miner Core Scientific filling for bankruptcy probes crypto buyers who are trying to benefit from the US dollar and positive news from Ripple and Twitter and chain matrix.

  • Strong buy: GBPUSD
  • Strong sell: ETHUSD, USDJPY
  • Buy: USD Index, USDCAD, Nasdaq, EURUSD
  • Sell: DAX, FTSE 100, gold, BTCUSD, AUDUSD

US GDP, PCE data in focus ahead of a sluggish week

Although the majority of the global markets have already sneaked into the holiday mood, final prints of the US Q3 GDP and PCE data, as well as the Fed’s preferred inflation number, could entertain traders for the last time in 2022 before the likely inactive week. Also important will be the headlines from China and Russia. Amid these plays, the US Dollar is likely to remain pressured unless the Treasury bond yields recover and/or Fedspeak sounds hawkish.

May the trading luck be with you!