#GBPUSD @ 1.15468 is marching towards 1.1600 as Liz Truss’s win warrants UK’s political stability. (Pivot Orderbook analysis)

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• GBP/USD is marching towards 1.1600 as Liz Truss’s win warrants UK’s political stability.
• British energy supplier, Centrica is securing credit to offset collateral demand for volatile energy prices.
• Fed’s extreme hawkish stance is responsible for lower consensus for US ISM Services PMI.

The pair currently trades last at 1.15468.

The previous day high was 1.1589 while the previous day low was 1.1496. The daily 38.2% Fib levels comes at 1.1532, expected to provide support. Similarly, the daily 61.8% fib level is at 1.1554, expected to provide resistance.

The GBP/USD pair has given an upside break of the consolidation formed in a narrow range of 1.1512-1.1520 in the early Tokyo session. The asset has displayed a sheer upside as a volatility expansion has kicked in after a range breakout. Earlier, the cable witnessed a firmer rebound after hitting a low of 1.1450. Broadly, the asset was declining for the past few weeks amid political instability in the UK economy. Now, the announcement of a leadership change has strengthened the pound bulls.

After fighting for the leadership of the Conservative Party for more than two months, Liz Truss has finally won the elections and has been elected as the next UK Prime Minister. As announced by Liz Truss while presenting her capabilities for contender of UK leadership that she will scale down energy bills for households, pound bulls have started playing the road. Also, a situation of political stability in the UK economy will strengthen sterling.

Meanwhile, the impact of volatile energy prices has spread to energy suppliers. News from Financial Times cited that, Britain’s largest energy supplier Centrica Plc is in talks with banks to secure billions of pounds in extra credit to meet soaring collateral demands as the energy market remains volatile.

On the dollar front, the US dollar index (DXY) has surrendered the psychological support of 110.00. The DXY is facing the heat of lower consensus for the US ISM Services PMI data. The economic data will decline to 55.5 from the prior release of 56.7. It seems that the consequences of the extremely hawkish Federal Reserve (Fed) are visible now and the US economic activities are declining. The unavailability of cheap money has forced the corporate to postpone the funds’ channelization into afresh investment opportunities and expansion plans.

Technical Levels: Supports and Resistances

GBPUSD currently trading at 1.155 at the time of writing. Pair opened at 1.151 and is trading with a change of 0.35 % .

The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 1.1884, 50 SMA 1.1984, 100 SMA @ 1.2233 and 200 SMA @ 1.2791.

The previous day high was 1.1589 while the previous day low was 1.1496. The daily 38.2% Fib levels comes at 1.1532, expected to provide support. Similarly, the daily 61.8% fib level is at 1.1554, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 1.1474, 1.1439, 1.1381
• Pivot resistance is noted at 1.1567, 1.1625, 1.166

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