7 May 2015
GBP/USD recovers losses, back at 1.5240
FXStreet (Mumbai) - The British pound recovered from a brief dip below 1.52 and trades almost unchanged against the US dollar in the European session, with GBP/USD treading waters as markets remains nervous ahead of an uncertain outcome with the UK election underway. While a fresh USD sell-off also helped the cable to recover.
GBP/USD back above 1.52
The GBP/USD pair trades flat at 1.5244, recovering from 1.5166 session lows posted UK parliamentary elections commenced. The cable remains cautious as traders refrain from creating fresh positions amid on-going UK election.
Meanwhile, renewed selling witnessed in the US dollar against its major competitors on the back discouraging ADP employment data helped the cable to recover from session lows. The dollar index which measures the relative strength of the greenback against the basket of six major currencies trades at 94.04, down -0.16% on the day.
With reference to forecasts on the UK election, Nomura believes, "Although it may take many days for the exact terms of the new government to be known, the seat arithmetic early on 8 May could reveal who will be leading it."
"Our baseline forecast continues to be 290 seats (±30) for the Conservatives, which would be enough to command the confidence of the house with 28 LibDems (±6) and 8-9 DUP MPs. The exit poll at 10pm may provide valuable information again, so we will be watching this as a first guide before the results start rolling in, with the outcome likely to be clear at about 4am on Friday."
GBP/USD Levels to consider
The pair has an immediate resistance at 1.5292 (May 6 High) above which gains could be extended to 1.5347 levels. On the flip side, support is seen at 1.5200 below which it could extend losses to 1.5166 (Today’s Low) levels.
GBP/USD back above 1.52
The GBP/USD pair trades flat at 1.5244, recovering from 1.5166 session lows posted UK parliamentary elections commenced. The cable remains cautious as traders refrain from creating fresh positions amid on-going UK election.
Meanwhile, renewed selling witnessed in the US dollar against its major competitors on the back discouraging ADP employment data helped the cable to recover from session lows. The dollar index which measures the relative strength of the greenback against the basket of six major currencies trades at 94.04, down -0.16% on the day.
With reference to forecasts on the UK election, Nomura believes, "Although it may take many days for the exact terms of the new government to be known, the seat arithmetic early on 8 May could reveal who will be leading it."
"Our baseline forecast continues to be 290 seats (±30) for the Conservatives, which would be enough to command the confidence of the house with 28 LibDems (±6) and 8-9 DUP MPs. The exit poll at 10pm may provide valuable information again, so we will be watching this as a first guide before the results start rolling in, with the outcome likely to be clear at about 4am on Friday."
GBP/USD Levels to consider
The pair has an immediate resistance at 1.5292 (May 6 High) above which gains could be extended to 1.5347 levels. On the flip side, support is seen at 1.5200 below which it could extend losses to 1.5166 (Today’s Low) levels.