Fundamental view:
In the past week, US Non-Manufacturing PMI released at 6th July and US Unemployment Rate released at 9th July supported greenback and created a bearish trend for the pair whereas UK Construction PMI favorable release at 6th July and UK Halifax monthly report released at 7th July boosted the pound and created bullish trend . Also to be noted Reckoning of Brexit talks impacted the pair positively.
Chancellor Rishi Sunak’s statement portrayed the economic recovery steps taken by UK creating hopes among investors and the trend showed a bullish view last week.
The major economic events deciding the movement of the pair in the next week are GBP GDP Monthly report, USD Core Consumer Price Index (CPI) at Jul 14, Monetary Policy Report Hearings, USD Treasury Currency Report at Jul 15, USD Unemployment Claims at Jul 16, and GBP Retail Sales monthly report at Jul 17.
GBP/USD Weekly outlook:
Technical View:
Last week’s high was 1.11% higher than the previous week. Maintaining high at 1.2669 and low at 1.2462 showed a movement of 207 pips.
In the upcoming week we expect GBP/USD to show a bearish trend. While the currency pair is trading above the 100 Simple Moving Average but the MACD trades to the downside. A solid breakout below 1.2496 may open a clean path towards 1.2374 and may take a way down to 1.2288. Should 1.2704 prove to be unreliable resistance, the GBPUSD may raise upwards 1.2791 and 1.2912 respectively. In H4 Chart, formation of ABCD Pattern favors prospects of a bearish trend as well as Shooting star formation escalates the expectation for a bearish trend.
| Preference |
| Sell: 1.2642 target at 1.2469 and stop loss at 1.2713 |
| Alternate Scenario |
| Buy: 1.2713 target at 1.2815 and stop loss at 1.2642 |
