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GBP/USD is building on Friday’s sharp recovery from below 1.2900 so far this Monday, as the bulls remain hopeful of some positive developments from a fresh round of Brexit negotiations likely to be held between EU’s Chief Negotiator Michel Barnier and his British counterpart David Frost. EUR/USD is trading around 1.17, at the bottom of the recent range. The steep increase in coronavirus cases in Europe is likely to keep undermining the euro while speculative interest fears an even slower economic comeback as restrictive measures returned. EUR/USD could slip back to the 1.1650 region in the next weeks, according to FX Strategists at UOB Group. European markets have been lifted by comments from U.S. House Speaker Nancy Pelosi, who said on Sunday she was optimistic legislation on a wide-ranging coronavirus relief package could be pushed through before the election. A deal will have to be done very quickly though, with Pelosi setting a Tuesday deadline for Congress to pass the measures.Dollar Index was up 0.1% at 93.8727, following a 0.7% rise last week when a global surge in coronavirus cases and an impasse over the stimulus package prompted caution. USD/JPY was largely flat at 105.41, while USD/CNY rose 0.1% to 6.7024.

50-DMA is the level to beat for the GBP/USD bulls. The cable teasing a symmetrical triangle breakdown on the daily chart. UK PM Johnson to decide Brexit fate on Friday. EUR/USD pair is trading largely unchanged on the day around 1.17.  Europe seems to be losing the fight to keep their economies open as the Covid-19 virus spreads. Starting this weekend, Londoners will be banned from mixing with other households, and residents of Paris and other major French cities face a curfew for four weeks. Additionally, although German Chancellor Angela Merkel reported "some movement" on Thursday in talks between European Union leaders about a potential Brexit agreement, the two sides have barely made any progress this week and time is running very short. The dollar edged higher in early European trade Friday, heading for its best week of the month as rising coronavirus cases prompt nervous traders to seek out this safe haven. The Dollar Index was up just 0.01% at 93.873, posting gains of around 0.8% this week, its best weekly performance since late September. USD/JPY was down 0.1% at 105.33.

GBP/USD is battling 1.3000, as the bulls take a breather ahead of the two-day European Union (EU) Summit, starting today. The 4-hour EUR/USD chart is showing that critical support at 1.1720 is in danger as the EUR/USD pair trades at its daily low of 1.1735 at the time of writing. Concerns that a resurgence in the Covid-19 pandemic could lead governments throughout Europe to shut down their economies again has hit the confidence of investors, particularly after the recent stock rally. Germany, France, the U.K., and others are in the process of instituting measures such as limited lockdowns, bar closures and other systems intended to reduce the spread of infection. This is occurring while doubts are emerging over the speed at which vaccines will be approved. Despite the global push for a Covid-19 vaccine, with dozens in clinical trials and hopes for initial inoculations this year, WHO Chief Scientist Soumya Swaminathan reiterated Wednesday that mass shots were unlikely to be widely available in the near future. The dollar edged higher in early European trade Thursday on safe haven inflows as coronavirus cases continue to mount and the idea of pre-election stimulus in the U.S. is officially consigned to the trash.  The Dollar Index was up 0.1% at 93.483. USD/JPY was up 0.1% at 105.28. The risk-sensitive AUD/USD dropped 0.7% to a one-week low of 0.7110, weighed by Australia’s central bank chief hinting at a possible rate cut or bond buying.

GBP/USD has failed at its corrective target at 1.3070 and is extending Tuesday’s sell-off. The cable trades just above the 1.29 mark and Commerzbank expects to see further losses to 1.2445 and eventually targets 1.2250/00. The pair couldn’t crack 21-day EMA, an ascending trend line from September 25, which in turn joins bullish MACD to tease the buyers targeting at 1.3013. A downside break of 1.2935 can target the 50% Fibonacci retracement level of 1.2868. EUR/USD trades lifeless near 1.1740 and strategists expect the 1.1700 level to attract. EUR lurched lower during NY hours and dropped to a low of 1.1729 before closing on a weak note at 1.1744. Eli Lilly (NYSE:LLY) placed its antibody test on hold due to potential safety concerns, just a day after Johnson & Johnson (NYSE:JNJ) paused its Covid-19 vaccine trial because of a participant’s unexplained illness. The dollar edged higher in early European trade Wednesday, holding on to recent gains following doubts about how quickly a Covid-19 vaccine will come to the market, prompting a more risk averse trading environment. The Dollar Index was up marginally at 93.567. USD/JPY was up 0.1% at 105.50. 

GBP/USD recorded fresh 5-week highs around 1.3080 at the beginning of the week on the back of renewed optimism surrounding the UK-EU Brexit negotiation. EUR/USD remains pressured around 1.1800 as market sentiment remains tilted to the risk-off mood on Tuesday. Dollar Index was up 0.1% at 93.227, regaining a little ground after falling Friday to a three-week low of 92.997. USD/JPY was up 0.1% at 105.37. European shares hovered at five-week highs on Tuesday following a three-day rally that was sparked by hopes of more U.S. stimulus, while Airbus slipped after JPMorgan (NYSE:JPM) downgraded its rating on the stock. The pan-European STOXX 600 (STOXX) was flat, with gains for utilities (SX6P), real estate (SX86P) and telecoms (SXKP) stocks offset by declines in the travel and leisure (SXTP) and autos (SXAP) sectors. 

GBP/USD fails to extend Friday’s upside momentum despite staying above 1.3020. UK PM Johnson up for Australia-style trade deal if there’s no deal by October 15, pushes Germany to bridge the gap. Stricter virus-led lockdown conditions will be announced by the PM for tier-3 hotspots. EUR/USD gapped lower in Asia on renewed coronavirus concerns, trading at 1.1815.ECB's President Lagarde is likely to reiterate the central bank's dovish stance. The US treasury yield curve has steepened in a dollar-positive manner to the levels last seen in November 2016. Dollar Index was up 1% at 93.108, regaining a little ground after recording its biggest loss in six weeks on Friday, falling to a near-three-week low of 92.997. USD/JPY was down 0.1% at 105.50.

UK GDP arrived at +2.1% MoM in August vs. +4.6% expected. GBP/USD holds on to modest gains near 1.2950 post-data. EUR/USD looks north as the dollar takes a beating against most currencies. China’s Caixin Services Purchasing Managers Index rose to 54.8 in September, against August’s reading of 54, remaining in positive territory for a fifth consecutive month, suggesting the second largest economy in the world is quickly returning to health. Yuan's rally and risk-on action look to be weighing over the greenback. A continued rise in the US bond yields could stall the dollar sell-off. Dollar Index was down 0.1% at 93.528, while USD/JPY was down 0.1% at 105.94. 

GBP/USD keeps previous day’s recovery moves from 1.2844. Pubs and restaurants in Northern England go off from next Monday with UK’s 14,162 new daily cases of COVID-19. EU keeps hardstand on fisheries, Tories threaten to leave talks on October 15. BOE’s Bailey will speak in an online panel discussion at the Single Resolution Board's annual conference. Cable’s prospect remains mixed and is now forecasted to trade between 1.2750 and 1.3000 in the short-term. The Dollar Index was down 0.1% at 93.562, while USD/JPY was largely flat at 105.97. EUR/USD climbed 0.2% to 1.1778. Rabobank, forecasts the EUR/USD pair trading at 1.17 next month as the US dollar is to see a short-covering of its positions amid volatility due to US Elections.

The GBP/USD pair has failed on its initial test of the mid-September high at 1.3008. The market charted an outside day to the downside and although we are unable to rule out a slightly deeper move to 1.3070, this seems less likely, according to Commerzbank. "Should the market fail in the 1.3000/70 zone as expected, we should see further losses to 1.2445 and then 1.2250/00". EUR/USD is now seen navigating between 1.1640 and 1.1820 for the time being. The pair is currently trading near 1.1730, having hit a low of 1.1725.  The U.S. Dollar Index edged up 0.19% to 93.922. The cancellation destroyed the sense of calm regained in the market after he was discharged from Walter Reed on Monday after being treated for COVID-19, and decreased risk appetite as hopes for the stimulus measures to be passed before the Nov. 3 presidential election evaporated.  The USD/JPY pair inched up 0.06% to 105.68.  8:30am Halifax HPI m/m 1.50% vs 1.60%  1:10pm ECB President Lagarde Speaks  7:00pm FOMC Meeting Minutes