Fundamental view:

British pound traders have had a wild week initially but later in the week showed a bullish trend against greenback. Meanwhile Brexit is in its final hours of negotiation. Negotiation between the United Kingdom and the European Union is still going as arguing about fish is still on. United Kingdom is locking down its economy, and we have to eventually start focusing on the economy itself, as it certainly will not be pretty. US Richmond Manufacturing Index on 22^nd Dec and US Core PCE Price Index monthly report & US Personal Income on 23^rd Dec favored bullish atmosphere for the pair whereas Britain Public Sector Net Borrowing & Britain Current Account on 22^nd Dec favors bearish atmosphere for the pair.

The major economic events deciding the movement of the pair in the next week are US Dallas Fed Manufacturing Index at Dec 28, UK Nationwide HPI yearly report, US S&P/CS HPI Composite-20 y/y at Dec 29, US Pending Home Sales monthly report, US EIA Crude Oil Stocks Change at Dec 30, US Initial Jobless Claims at Dec 31.

GBP/USD Weekly outlook:

Technical View:

Last week’s high was 0.04% lower than the previous week. Maintaining high at 1.3619 and low at 1.3188 showed a movement of 431 pips.

In the upcoming week we expect GBP/USD to show a bearish trend.  The currency pair is trading above the 200 Simple Moving Average and the MACD trades to the downside. A solid breakout below 1.3283 may open a clean path towards 1.3020 and may take a way down to 1.2852. Should 1.3714 prove to be unreliable resistance, the GBPUSD may raise upwards 1.3883 and 1.4146 respectively. Chart formation of bearish butterfly pattern in H4 chart favors prospects of a bearish trend. Spinning top pattern formation escalates the expectation for a bearish trend.