The British pound pared some of the losses made yesterday as Boris Johnson prepared to travel to Brussels for make-or-break talks with Ursula von der Leyen. The talks will happen as the two sides failed to reach agreements on key areas like fishing rights and fair trading practices. Media reports yesterday suggested that Johnson was prepared to walk away from the talks. Also, in a statement to EU leaders, Michel Barnier warned that he could not guarantee that a deal would happen. In another statement, Simon Coveney, the Irish prime minister said that the mood was starting to shift to contingency planning in the EU.

The Japanese yen was little changed after better economic numbers from Japan. In a report released earlier today, the country’s statistics office said that the country’s economy bounced back by 5.3% in the third quarter. That was better reading than the first estimate of 5%. On an annualised basis, the Japanese economy expanded by 22.9% in the quarter after sinking by 28.1% in the second quarter. This performance was mostly because of a 5.1% increase in private consumption and a 2.7% increase in external demand. Capital expenditure declined by 2.4% as firms continued to preserve their capital.

The euro is little changed ahead of the final reading of the third-quarter GDP data. Economists polled by Reuters believe that the Eurozone economy bounced back by 12.6% in the third quarter as countries continued to reopen. Like in Japan, this performance will mostly be because of a strong increase in private consumption and external demand. The euro will also react to the latest German economic sentiment data by ZEW.

EUR/USD

The EUR/USD is wavering as traders wait for the European GDP estimate. The pair is trading at 1.2109, which is slightly below last week’s high of 1.2177. On the hourly chart, the price has moved below the 14-day and 28-day exponential moving averages. It also seems to be forming a head and shoulders pattern whose neckline is at the 1.2080 level. The two lines of the stochastic oscillator have also moved from the oversold level. For today, the key support and resistance levels to watch will be 1.2080 and 1.2140.

GBP/USD

The GBP/USD pair is trading at 1.3348, which is higher than yesterday’s low of 1.3220. On the four-hour chart, the price has moved back to the ascending yellow trendline. It is also slightly below the 25-day and 15-day exponential moving averages. At the same time, the average true range, which is a good measure of volatility, has risen to the highest level this month. Therefore, because of Brexit issues, the pair will possibly be a bit volatile in the short term.

USD/CHF

The USD/CHF pair dropped to a five-year low of 0.8878 yesterday. It then pared back some of the earlier losses and is now trading at 0.8900. On the four-hour chart, the pair seems to be forming a bearish consolidation pattern. It is also between the two lines of the envelopes indicator and below the 25-day EMA. Therefore, the consolidation is likely to remain today as bears ponder the next moves. The support and resistance levels to watch are 0.8875 and 0.8975.