Looking for the latest outlook, for the current week? Check out the section: GBP USD Forecast
The British Pound continued falling this week, especially hurt by the final release of GDP. The upcoming holiday week contains very few indicators. Here’s an outlook for the events that will affect the Pound, and an updated technical analysis.
GBP/USD chart with support and resistance lines marked on it. Click to enlarge:
The Quantitative Easing program that was eyed by many cable traders is probably finished, and won’t be renewed. The meeting minutes revealed that there was a consensus on leaving the program unchanged this time. The heavy government deficit is now eyed. Let’s start:
- Nationwide HPI: Published on Thursday at 7:00 GMT. British house prices have risen in the past 7 months, but the pace has slowed below 1% in the past three months. After a 0.5% rise last time, it’s expected to rise by 0.4% this time. This will shake the Pound.
- BOE Credit Conditions Survey: Released on Thursday at 9:30 GMT. This survey is released quarterly by the Bank of England and shows the sentiment in credit. A report indicating better conditions will help the Pound.
GBP/USD Technical Analysis
GBP/USD fell below the 1.6110 to which it dipped last week, and went further down, below 1.60, closing the week at 1.5959.
1.60 is now a minor resistance line, being also a psychological line. Further above 1.6110 is another resistance line, also it’s less significant than earlier. The lines haven’t changed since last week’s outlook.
The next line is somewhat stronger: 1.6260. Even higher, 1.65 is the next significant line, but it’s very far now.
Looking down, 1.5720 is a very strong support line. GBP/USD bounced off this line before it began the big comeback. Even lower, 1.5350 is the next support line, but there’s a very slim chance that the Pound will dip below 1.5720 this week.
I remain bearish on GBP/USD.
Britain’s economy is still behind other economies, and with the current dollar strength, the direction continues to be down.
Further reading on Forex Crunch:
- For a broad view of all the week’s major event in all currencies, read the forex weekly outlook.
- For the Euro, read the EUR/USD forecast.
- For the Australian dollar, read the Aussie forecast.
- For USD/CAD, check out the Canadian dollar forecast.
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