The GBPUSD currency pair is facing difficulty in taking advantage of a recent bounce back from its lowest point in two weeks.

…
This is a premium post.
[s2If !current_user_can(access_s2member_level4)]Please register for FREE REGISTER to read full post below containing analysis. In case of any error or you think you are not able to read the full post below, please email us at support#nehcap.com [lwa][/s2If] [s2If current_user_can(access_s2member_level1)]

• GBP/USD struggles to capitalize on the overnight late rebound from a two-week low.

The pair currently trades last at 1.26370.

The previous day high was 1.2753 while the previous day low was 1.2606. The daily 38.2% Fib levels comes at 1.2662, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.2697, expected to provide resistance.

The GBP/USD pair oscillates in a narrow trading band during the Asian session on Thursday and consolidates the overnight slump to the 1.2600 neighbourhood, or a two-week low. The pair currently trades around the 1.2630-1.2625 region, down less than 0.10% for the day, and seems vulnerable to prolonging its recent corrective decline from the YTD peak touched earlier this month.

The US Dollar (USD) stands tall near a two-week high in the wake of Federal Reserve Chair Jerome Powell’s hawkish remarks on Wednesday and is seen as a key factor weighing on the GBP/USD pair. Speaking at a European Central Bank (ECB) conference, Powell reiterated that two rate increases are likely this year and did not rule out the possibility of a rate hike at the next FOMC policy meeting on July 25-26. Powell also said that he does not see inflation coming down to the Fed’s 2% target until 2025.

The British Pound (GBP), on the other hand, is weighed down by fears that the UK economy is heading for recession, especially after a surprise 50 bps rate hike by the Bank of England (BoE) last Thursday. Investors also seem worried that further increases in interest rates will spark a mortgage crisis and raise borrowing costs for government debt. The fears were further fueled by BoE Governor Andrew Bailey’s comments, hinting that rates could remain at peak levels for longer than traders currently expect.

The aforementioned fundamental backdrop seems tilted in favour of bearish traders and suggests that the path of least resistance for the GBP/USD pair is to the downside. Some follow-through selling below the overnight swing low will reaffirm the negative bias and pave the way for a further near-term depreciating move. Market participants now look to the US economic docket – featuring the final Q1 GDP print, the Weekly Initial Jobless Claims and Pending Home Sales – for a fresh impetus.

Technical Levels: Supports and Resistances

GBPUSD currently trading at 1.263 at the time of writing. Pair opened at 1.2635 and is trading with a change of -0.04 % .

The pair is trading below its 20 Daily moving average @ 1.2635, above its 50 Daily moving average @ 1.254 , above its 100 Daily moving average @ 1.2368 and above its 200 Daily moving average @ 1.2096

The previous day high was 1.2753 while the previous day low was 1.2606. The daily 38.2% Fib levels comes at 1.2662, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.2697, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 1.2577, 1.2519, 1.2431
• Pivot resistance is noted at 1.2723, 1.2811, 1.2869

[/s2If]
Nehcap Expert Advisor
The NEHCAP MT4 EA is high quality professional trading system geared to generate returns without using GRID or martingales. Each trade has strict risk per trade parameter. The pairs under management include EURUSD, GBPUSD, AUDCAD, AUDNZD,GBPAUD, EURAUD, EURCAD, CHFJPY and many more.
The system is trading live: LIVE ACCOUNT TRACKING
You can run it free. Apply for a free trial and track our account. Buy the system or use profit share mechanism to generate returns on your MT4.
Join Our Telegram Group