Fundamental view:

The British pound has rallied significantly against greenback during the course of the week. The improving coronavirus situation in the UK, a strengthening economy and rising inflation has extended helping hand towards pound against greenback. On the other hand, US central bank left its monetary policy unchanged which was expected. In his press conference, Mr. Powell said that the withdrawal of monetary support has become an active topic among the governors. He also said that the US job market still had “some ground to cover” before the bank would begin the reduction of its $120-billion-a-month in purchases of Treasury and mortgage-backed securities.

Britain BoE Mortgage Approvals on 29th July & US Michigan Consumer Expectations on 30th July created downtrend whereas US New Home Sales on 26th July and Richmond Fed Services Revenues on 27th July created uptrend for the pair.

The major economic events deciding the movement of the pair in the next week are UK Markit/CIPS Manufacturing PMI, US ISM Manufacturing PMI at Aug 02, US ADP Nonfarm Employment Change, US ISM Non-Manufacturing PMI at Aug 04, BoE Interest Rate Decision, US Initial Jobless Claims at Aug 05 and US Nonfarm Payrolls at Aug 06.

GBP/USD Weekly outlook:

Technical View:

Last week’s high was 1.43% higher than the previous week. Maintaining high at 1.3983 and low at 1.3736 showed a movement of 247 pips.

In the upcoming week we expect GBP/USD to show a bullish trend.  The currency pair is trading above the 200 Simple Moving Average and the MACD trades to the upside. A solid breakout above 1.4013 may open a clean path towards 1.4122 and may take a way up to 1.4260. Should 1.3766 prove to be unreliable support, the GBPUSD may sink downwards 1.3628 and 1.3519 respectively. In H4 chart symmetrical triangle pattern breakout favors prospects of a bullish trend. Bullish engulfing pattern formation escalates the expectation for a bullish trend.