GBP/USD reluctantly moves higher as the USD weakens ahead of Powell

• The GBP/USD is unable to take advantage of the USD breather.
• Concerns of a no-deal Brexit weigh on the Pound.
• The technical picture shows that upside momentum has disappeared. 

The GBP/USD is trading just above 1.2800. The US Dollar is taking a breather ahead of Fed Chair Jerome Powell’s speech at Jackson Hole. However, cable is unable to take advantage of it and remains pressured.

The British government released a series of notices towards a no-deal Brexit on Thursday. UK Brexit Minister Dominic Raab said that he is optimistic about getting a “good deal”. Nevertheless, there have been no reports about progress in the negotiations and the publication of the no-deal papers served as a reminder that crashing out is a plausible outcome.

In the US, data was not that great, with New Home Sales providing the second day of housing disappointments. However, the US Dollar advanced as trade talks between China and the US were inconclusive. The greenback moves higher on escalations in the trade wars.

The focus shifts back to the Federal Reserve as Chair Jerome Powell speaks in Jackson Hole at 14:00 GMT. While a September hike is priced in, the focus will be long-term trends and Powell can move markets.

See: Powell’s Jackson Hole Speech: Three topics to watch out for beyond the September hike

Before Powell’s public appearance, the US publishes the Durable Goods Orders for July, the first month of Q3. A slide is expected after significant increases beforehand.

See: USUS

GBP/USD Technical Analysis

The GBP/USD has lost upwards momentum and the Relative Strength Index is flat.

Support awaits at the round 1.2800 level which supported the pair in recent hours. It is backed up by the 50 Simple Moving Average on the four-hour chart. Further down, 1.2760 held the pair down in mid-August and now serves as a support. Lower, 1.2730 was a stepping stone on the way up later in the month. The 2018 low of 1.12662 is next.

1.2940 was the peak seen in recent days. It is followed by the round number of 1.3000 and then by 1.3050 which worked in both directions before the recent fall.

More: GBP/USD at critical support, break or bounce? — Confluence Detector