Fundamental view:

Pound fell against greenback in the last week. US Powell spoke regarding monetary policy. He said that inflationary pressures are likely to be temporary and pledged to maintain the financial support until the economy fully recovers. Meanwhile, Democrats presented a $3.5 trillion infrastructure package. On the other hand, In the UK, Prime Minister Boris Johnson insisted that the July 19 reopening would go through, despite the rapid spread of the Delta variant. Fears about increasing deaths and hospitalizations also pressured pound.

Britain CPI monthly report on 14th July and Britain Claimant Count Change on 15th July created an uptrend whereas US Federal Budget Balance on 13th July and US EIA Crude Oil Stocks Change on 14th July created a downtrend for the pair.

The major economic events deciding the movement of the pair in the next week are BoE MPC Member Haskel Speech at July 19, US Building Permits at July 20, US EIA Crude Oil Stocks Change at July 21, US Initial Jobless Claims, US CB Leading Economic Index monthly report at July 22, UK Retail Sales monthly report and US Markit Manufacturing PMI at July 23.

GBP/USD Weekly outlook:

Technical View:

Last week’s high was 0.06% higher than the previous week. Maintaining high at 1.3909 and low at 1.3760 showed a movement of 149 pips.

In the upcoming week we expect GBP/USD to show a bearish trend.  The currency pair is trading below the 200 Simple Moving Average and the MACD trades to the downside. A solid breakout below 1.3711 may open a clean path towards 1.3661 and may take a way down to 1.3562. Should 1.3860 prove to be unreliable resistance, the GBPUSD may raise upwards 1.3959 and 1.4009 respectively. Chart formation of double top pattern in H4 chart favors prospects of a bearish trend. Bearish engulfing pattern formation escalates the expectation for a bearish trend.