GBP/USD better bid, but capped by 1.2500 ahead of UK PMI

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GBP/USD better bid, but capped by 1.2500 ahead of UK PMI

The GBP/USD pair is seen on a steady recovery path so far this session, with the bulls now trying hard to regain 1.25 handle amid moderate risk-aversion.

Cable peeks into the green amid subdued treasury yields, in the wake of lack-luster US manufacturing PMI reports released a day before. However, the recovery gains appear capped amid negative equities, as risk-off extends into Asia.

Moreover, the sentiment around the pound remains somewhat undermined, as yesterday’s poor UK manufacturing PMI report continues to weigh. The UK manufacturing PMI for March arrived at 54.2 versus 55.1 expectations and 54.6 last.

Focus now shifts towards the UK construction PMI data due later in the European session for fresh impetus on the spot. Also, the US trade and factory orders data will be closely eyed for next direction on the buck.

GBP/USD Levels to consider            

Valeria Bednarik, Chief Analyst at FXStreet notes, “The 4 hours chart supports additional declines, as the price is currently developing below its 20 SMA, whilst the Momentum indicator is crossing below the 100 level, and the RSI heading south around 46. Still the pair has a major support around 1.2430, which stands for the 38.2% retracement of the January rally. A break below this last should expose March 29th low of 1.2375, en route to 1.2330 a strong static support. The upside should remain capped by selling interest around 1.2540/60 for the bearish trend to remain in place.”

GBP/USD eyes key fibo support at 1.2430

Currently, GBP/USD is trading at 1.2474, down -0.60% on the day, having posted a daily high at 1.2557 and low at 1.2466.

GBP/USD has been hit hard today, starting overnight on the back of UK Markit manufacturing PMI for March that sent sterling traders offloading cable below the 1.25 handle. The data arrived in at 54.2 for a four-month low. This was vs. the prior 56.2 and missing expectations of 55.1. The ISM manufacturing in the US was positive although markit manufacturing PMI was missing expectations by 0.2%. The key events for the week http://humanrightsfilmnetwork.org/cialis will come in the form of the FOMC minutes and the nonfarm payrolls at the end of the week:

GBP/USD levels

To the downside, there is the major 1.2430 Fibonacci support and Valeria Bednarik, chief analyst at FXStreet explained that in the 4 hours chart supports additional declines, as the price is currently developing below its 20 SMA, whilst the Momentum indicator is crossing below the 100 level, and the RSI heading south around 46. “The upside should remain capped by selling interest around 1.2540/60 for the bearish trend to remain in place.”

A Bitcoin-Backed Stablecoin Has Launched on the Ethereum Blockchain

A new token backed one-to-one with bitcoin is now live on the ethereum blockchain.

“Wrapped BTC” (WBTC) officially launched its ERC-20 token Wednesday evening. The project was first unveiled in October as a joint initiative between decentralized exchange startups Kyber Network and Republic Protocol, as well as cryptocurrency custody company BitGo.

As stated on the project’s website, the aim of WBTC is to bring “greater liquidity to the ethereum ecosystem including decentralized exchanges and financial applications.”

At the time, BitGo CTO Benedict Chan described WBTC as possessing both “the stability of bitcoin and the flexibility of ethereum,” likening the new crypto asset to traditional bank notes (the kind that were once redeemable for gold). While volatile compared to the U.S. dollar, bitcoin is the most liquid and stable of cryptocurrencies, he noted. While volatile compared to the U.S. dollar, bitcoin is the most liquid and stable of cryptocurrencies with the highest market capitalization, he noted.

Now listed on cryptocurrency market data site CoinMarketCap, as of early Wednesday evening there was a reported 72.4214 WBTC on the ethereum network, slightly over-collateralized with 72.4216 BTC (roughly $250,000) locked in custody on the bitcoin blockchain.

Leveraging a technology known as “atomic swaps” to facilitate cross-chain cryptocurrency trades, users on ethereum can request WBTC from certified “merchants” after undergoing necessary anti-money-laundering and know-your-customer (AML/KYC) identification procedures.

Playing a key role in the exchange and liquidation of new WBTC tokens, merchants are defined in the technology’s white paper as “the institution or party to which wrapped tokens will be minted to and burnt from.”

According to the WBTC team, there are presently eight merchants to facilitate conversion between WBTC and BTC. These include: AirSwap, Dharma, ETHfinex, GOPAX, Kyber Network, Prycto, Ren and Set Protocol.

How users receive WBTC tokens. Image courtesy of Kyber Protocol.

Traded on exchanges

In addition, a number of cryptocurrency exchanges have already procured part of the initial WBTC inventory and will be able to support its live supply directly on their respective platforms, according to a WBTC press release.

As well, several financially-focussed decentralized applications on ethereum, including bZx, Compound and dYdX, will allow “immediate usage” of the new token.

As such, despite the concern expressed by the creator of ethereum, Vitalik Buterin, on Twitter over the centralized nature of this token swap system, the press release states:

“The fundamental design of WBTC and the continuing commitment of all member to openness will form the essential building blocks for a transparent process framework and governance structure … WBTC will remain a firmly community-led initiative.”

A $5 National Gold Bank Note issued by the First National Gold Bank of San Francisco, California, image via Wikimedia Commons.