The Pound recovers to 1.2800 after being boosted by investor’s increasing demand for high beta currencies. Investors turned towards high beta currencies such as the Pound after it was announced that President Trump and President Xi reached an agreement to ease the trade dispute between the US and China. Easing trade tensions improve sentiment in the market and pave the way for investors to feel comfortable about taking risky bets in high beta assets and currencies. Note that Trump agreed to hold off initiating tariffs on $200 billion worth of Chinese goods, while Xi promised to reduce the trade imbalance between the two nations by purchasing large amounts of US goods.
The Pound is currently attempting to break above the 50-period moving average, the confirmation of a break above this moving average will pave the way for a rise towards the next key resistance point at the 200-period moving average. The failure to break above the 50-period moving average will drive the pair lower back towards the 1.2727 support level.
Support: 1.2727/ 1.2650
Resistance: 1.2829 / 1.2875