• Strong economic data out of the UK provides Sterling support
• Poor Nonfarm payrolls continue to play on investor confidence
• Focus now on today’s ISM Non-manufacturing PMI
• Close of day prediction – 1.335/6

Sterling finds new ground against the US Dollar post-Brexit

We are entering new ranges for the GBPUSD pair following the UK’s vote to leave the EU. The pair are currently range bound at 1.332-33 with further advances likely as we approach the latter part of the day.

The UK does appear to be shrugging off post-Brexit woes, but with little plan as to what Brexit is, it’s unlikely that the current trend will continue as we approach 2017.

However, there does remain some strong opportunities for GBPUSD as we approach October and November.

Is a FED interest rate raise on the cards?

It’s not surprising that many are growing impatient towards the FED’s hawkish stance on the US economy, Yellen has promised multiple interest rate hikes in 2016 and yet none have materialised. With the upcoming US elections, it’s looking increasingly unlikely that investors will see a hike until 2017. Friday’s Non-farm payrolls took a turn for the worse coming in 29k less than expected. Today’s ISM non-manufacturing PMI could rattle odds of a hike even further this year.

The release which looks at non-manufacturing business sectors and their conditions is due to be released at 3pm today. I am predicting sharp falls in the reading given the fall in employment, Service PMI and poor retail sales earlier this month.

I am predicting GBPUSD trading in the 1.335/6 range by the end of the trading day

US elections to boost GBPUSD exchange rates

The US Dollar will likely come under increasing pressure as we move closer to the US elections in November. Donald Trump remains a strong candidate against rival Hilary Clinton, and recent polls have suggested a lead in the Republican’s favour.

With the above in mind, we could see GBPUSD exchange rates move towards the 1.35/6 range in the coming weeks, before tailing off at the start of 2017.

US Dollar buyers, the US presidential elections could see the best opportunities to buy before the UK officially leaves the EU.