Fundamental view:

Pound has bounced back to forth in the last week which is largely because of the BOE and Nonfarm Payrolls. Bank of England has left its policy unchanged, by refraining from tapering and labeled inflation as transitory. Michael Saunders, was the only one member who voted in favor of tapering down the BOE’s bond-buying scheme. Without the hawkishness and a suggestion that monetary policy would only be “modestly” tighter which has an impact shortly.

US ISM Manufacturing PMI on 2nd August and Britain Markit/CIPS Services PMI on 4th August created uptrend whereas US Factory Orders monthly report on 3rd August and US ISM Non-Manufacturing PMI on 4th August created downtrend for the pair.

The major economic events deciding the movement of the pair in the next week are US JOLTS Job Openings at Aug 09, US Nonfarm Productivity at Aug 10, Federal Budget Balance at Aug 11, UK Manufacturing Production monthly report, UK GDP quarterly report, US Initial Jobless Claims, US WASDE Report at Aug 12 and US Michigan Consumer Sentiment at Aug 13.

GBP/USD Weekly outlook:

Technical View:

Last week’s high was 0.19% lower than the previous week. Maintaining high at 1.3957 and low at 1.3860 showed a movement of 97 pips.

In the upcoming week we expect GBP/USD to show a bearish trend.  The currency pair is trading below the 50 Simple Moving Average and the MACD trades to the downside. A solid breakout below 1.3836 may open a clean path towards 1.3799 and may take a way down to 1.3739. Should 1.3933 prove to be unreliable resistance, the GBPUSD may raise upwards 1.3993 and 1.4030 respectively. In H4 chart, symmetrical triangle pattern breakout downside favors prospects of a bearish trend. Also formation of a bearish engulfing pattern escalates the expectation of a bearish trend.