GBP soars on Brexit hopes and jobs data; Gold gains as USD retreats

Summary:

• GBPUSD back above $1.30 on Brexit hopes and solid jobs data
• Gold hits another 10-month as the buck retreats
• US stocks recover from soft start
• DE30: Wirecard keeps soaring
• Bitcoin hits 1-month high near $3900

There’s been some strong gains seen in the Pound today, with the currency the best performing major and trading higher against all its peers on the European close. The catalyst for the gains seems to be raised hopes that UK PM Theresa May can gain further concessions from the EU as she heads to Brussels for another meeting with Jean-Claude Juncker. Earlier in the day, we also got the latest UK jobs figures which were solid overall, with wages ex-bonus meeting forecasts and the unemployment rate remaining close to a multi-decade low.

GBPUSD rate has moved up to its highest level in a fortnight in response due both an appreciation in the pound and a depreciating greenback. The fall in the US dollar has also been felt in the commodity space with Gold building on Monday’s gains to rise above $1330 and print a fresh 10-month high. The precious metal is seemingly benefiting from lower bond yields and rumours of central bank purchases.

Stock markets across the Atlantic opened this afternoon for the first time this week as the US returned from a bank holiday weekend. The bulls were firmly in charge of the tape on Friday’s close with the benchmarks pushing up to their highest level since early December, but there was a little bit of weakness ahead of the opening bell today. The largest declines came in the US100, which was lower by around 05% on the opening bell but all the indices have recovered to trade back pretty much flat at the time of writing apart from the small cap US200 which has extended up above last week’s high.

Looking into the DE30 breakdown one may spot that two stocks are pulling the index higher - Wirecard (WDI.DE) and HeidelbergCement (HEI.DE). On the other hand, automotive industry stocks keep slightly underperforming. What is standing behind such notable rises in the two stocks mentioned above? As far as Wirecard is concerned the price keeps soaring following the yesterday’s decision of the German regulator to ban short selling on the stock. Take a look at the chart below to see a tremendous increase of percent of shares outstanding being sold short. It is worth adding that it was the first time the regulator has banned short selling on a single stock. In response to this decision the stock surged 15% yesterday and this move keeps unfolding today.

Most of major cryptocurrencies experienced significant rises yesterday. Moreover, the three largest virtual currencies - Bitcoin, Ripple, and Ethereum - hit their one-month highs. As a result, the capitalization of digital currencies increased to around the $133 billion mark whereas the market capitalization of altcoins jumped to around the $65 billion handle, as CoinMarketCap reports. After several days of lazy trading, the largest cryptocurrency Bitcoin jumped up and hit its one-month high. As a result of bullish charge, the virtual currency price gained around $250 within just 24 hours. The digital currency broke a key resistance area around $3650 which coincided with the 50-period moving average on the daily chart.