Market Analysis

The pound continues to lose ground in Tuesday

FOREX

The pound continues to lose ground to both the dollar and the euro during early Tuesday trading. The British Prime Minister will meet the President of the European Commission later in the day with the two leaders trying to find common ground after their negotiating teams apparently find themselves at a deadlock and unable to agree on some core issues. The future relationship between the two parties now rests in the politicians’ hands, with most investors still expecting a deal to be reached. However, such hopes will start to dissipate if there is no progress after today’s encounter. The last few days brought moderate losses for the pound, as investors gently started to price-in the increasing likelihood of no-deal, but should the impasse persist after today’s meeting between Ursula von der Leyen and Boris Johnson, more intense selling pressure will start to build around the British currency.

Ricardo Evangelista – Senior Analyst, ActivTrades


GOLD

Gold broke through the resistance level at $1,850 as the weakening US Dollar, some bits of risk off on stock markets and a final attempt of the Trump team to renew its campaign against China pulled up financial demand for bullion. Moreover, the drop in price of the last few weeks has lifted up physical demand, generating the perfect environment for a rebound for the spot price. This is exactly what we have seen in the last few days, when gold was able to jump up from the four-month-low and recover, surpassing the key level of $1,850. Technically, the short-term trend remains supportive, while enlarging the zoom, there could still be some bearish pressure due to some profit-taking and the continuation of the risk on approach seen in November albeit with the odd day of exception, like yesterday.

Carlo Alberto De Casa – Chief analyst, ActivTrades

 

The information provided does not constitute investment research. The material has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and as such is to be considered to be a marketing communication. All information has been prepared by ActivTrades PLC (“AT”). The information does not contain a record of AT’s prices or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information. Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not a reliable indicator of futures performance. AT provides an execution-only service. Consequently, any person acting on the information provided does so at their own risk.