The US Dollar collapsed on Tuesday and now trades are in a negative zone month-to-date following sharp declines over the last three consecutive sessions. The US Dollar selling pressure was broad-based, though weakness relative especially on the Pound and Yen. The GBPUSD price action pierced higher by about 75 pips while the USDJPY pair dipped around 65 pips.
The Cable price action currently looks like it could be in the initial stages of a bullish breakout with technical resistance around the 1.3800 mark. That said, it appears there might be some open runway for GBPUSD bulls to push toward the 1.4000-handle. The pair is expected to be one of the most dynamic major currency pairs on Wednesday judging by its implied move of 54 pips.
The US Dollar volatility has capacity to accelerate in reaction to the commentary expected from the Federal Reserve Chair Jerome Powell during his speech scheduled for Wednesday, 10 February at 19:00 GMT.
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