Fundamental view:

Pound traded low this week. Fed’s meeting minutes from the July meeting portrays a growing trend toward reducing the bank’s bond-buying scheme already in 2021.After media reports, the media report came about an upcoming announcement in September, which helped the dollar to rise. Increasing coronavirus cases gained importance after America reported some 250,000 in one day, accelerating the increase in average daily infections that topped 140,000. On the other hand, Covid cases in the UK also remain stubbornly high, clearly ending the rapid decrease recorded in mid-July.

US NY Fed Empire State Manufacturing Index on 16th August and Britain PPI Output monthly report on 18th August created uptrend whereas US Fed Industrial Production monthly report on 17th August and Britain Retail Sales monthly report on 20th August created downtrend for the pair.

The major economic events deciding the movement of the pair in the next week are UK Markit/CIPS Manufacturing PMI at Aug 23, US Core Durable Goods Orders monthly report, US EIA Crude Oil Stocks Change at Aug 25, US GDP quarterly report, Us Initial Jobless Claims at Aug 26, UK Nationwide HPI at Aug 27 and Fed Chair Powell Speech at Aug 27. 

GBP/USD Weekly outlook:

Technical View:

Last week’s high was 0.12% lower than the previous week. Maintaining high at 1.3878 and low at 1.3602 showed a movement of 276 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 1.3524 may open a clean path towards 1.3425 and may take a way down to 1.3248. Should 1.3800 prove to be unreliable resistance, the GBPUSD may raise upwards 1.3977 and 1.4076 respectively. Chart formation of descending scallop pattern in H4 chart favors prospects of a bearish trend. Bearish engulfing pattern formation escalates the expectation for a bearish trend.