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Is it me or is Cable on a low key uptrend on the 1-hour time frame?

Word of a possible Brexit deal by as early as next week kept the pound supported during the Asian session.

Before we talk setups, make sure to read the movers and shakers in the late U.S. and most of Asian session trading!

Major Forex Pairs Price Performance from MarketMilk
Major Forex Pairs Price Performance from MarketMilk

Upcoming Potential Catalysts on the Economic Calendar:

  • OPEC+ Monitoring Committee starts meeting today
  • Italy’s trade balance at 9:00 am GMT
  • Canada’s housing starts at 1:15 pm GMT
  • Canada’s wholesale sales at 1:30 pm GMT
  • U.S. retail sales at 1:30 pm GMT
  • BOE Governor Bailey to give a speech at 2:00 pm GMT

What to Watch: GBP/USD

GBP/USD 1-hour Forex Chart
GBP/USD 1-hour Forex Chart

Unless you were too busy looking at Bitcoin prices, you should know that news of Moderna’s 94% effective vaccine trials has weighed on the dollar and encouraged risk appetite.

Well, the pound got an extra boost today when word got around that Britain’s chief negotiator David Frost has told Prime Minister Boris Johnson to expect a Brussels trade deal “early next week.”

The news helped the bulls who have been trading GBP/USD along an ascending trend line on the 1-hour time frame.

If the Brexit deal headline gains traction in the London session, then we could see Cable pop by an extra 100 pips to its November highs. GBP/USD’s average volatility of 122 pips says it’s possible!

But if London traders focus on the kind of deal the U.K. could make by next week, or if the government plays down the odds of a Brexit deal, then we could see the pound break its short-term uptrend against the dollar. Look for a break below the 200 SMA and then target inflection points like 1.3115 or 1.3050.