The GBPUSD currency pair dropped by 0.18% to a level of 1.25782 as worries about worldwide business activity and the challenges facing China’s real estate market contribute to a cautious market sentiment.

…
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 falls 0.18%, as concerns over global business activity and China’s real estate market woes fuel a risk-off environment.

The pair currently trades last at 1.25782.

The previous day high was 1.2729 while the previous day low was 1.2592. The daily 38.2% Fib levels comes at 1.2644, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.2676, expected to provide resistance.

The Pound Sterling (GBP) finished the week on a lower note against the US Dollar (USD), falling to hold above the 1.2600 figure, with the GBP/USD sliding toward new two-month lows. As the New York session winds down, the pair is trading at 1.2576, down 0.18%, after hitting a daily high of 1.2654.

The GBP/USD was affected by several reasons. Reports that slowing global business activity, as revealed by S&P Global PMIs featured in the UK and the US, triggered flows towards safety on a risk-off mood and weighed on the major. Alongside that, China’s real estate market woes, with Evergrande’s filing for bankruptcy in New York last Friday and Country Garden’s removal from the Hong Kong Hang Seng index, increased worries about a worldwide economic downturn.

Consequently, the Greenback (USD) advanced, as shown by the US Dollar Index (DXY), which measures the buck’s performance against a basket of six currencies that includes the Cable, advanced 0.19%, finished the week at 104.187, at around new two month highs.

Data from the United States (US) witnessed a mixed report in Durable Goods Orders, while the labor market remained hot, as the US Bureau of Labor Statistics (BLS) revealed. Initial Jobless Claims for the week ending August 19 rose by 230K, below estimates of 239K, justifying additional rate increases by the US Federal Reserve (Fed), as the Chair Jerome Powell emphasized on Friday, in his speech at the Jackson Hole Symposium.

At Jackson Hole, the US Federal Reserve Chair Jerome Powell highlighted the ongoing concerns of the central bank regarding high inflation. He stated that further rate hikes could be “appropriate,” though he stressed the US central bank would continue to rely on incoming data. Powell mentioned even though a couple of months showed an acceleration in the disinflation process, he underscored the significance of staying aligned with the Fed’s 2% inflation target, signaling that there is still a considerable journey ahead.

Powell stated that the robust economic expansion and a constrained labor market could pave the way for additional tightening measures. He noted that further rate hikes would be warranted if these positive economic indicators do not exhibit signs of easing.

Recently, Philadelphia Fed’s Patrick Harker remarked that current interest rates are already at a restrictive level, and in the event inflation falters, there might be a necessity for additional rate hikes. Conversely, Cleveland Fed President Loretta Mester acknowledged that the economy has gained momentum, as evidenced by GDP and labor market indicators. She highlighted that a lower growth rate would be necessary to temper inflation while emphasizing the ongoing debate around whether the present rates are sufficiently restrictive to attain the inflation target.

Next week, the UK economic docket will be absent. On the contrary, the US economic docket will feature the CB Consumer Confidence, JOLTs report, preliminary GDP data, inflation figures, ISM PMI, and further Fed speakers.

The GBP/USD daily chart portrays the pair as neutral to downward biased, but the break below the latest market structure swing low at 1.2590 could exacerbate a test of the 200-day Moving Average (DMA) at 1.2397. Firstly, sellers must drag the exchange rate below the 1.2500 figure. A breach of the latter would expose the 1.2400 figure, followed by the 200-DMA. Conversely, if buyers reclaim 1.2600, that could open the door for a recovery towards the 1.2700 mark.

Technical Levels: Supports and Resistances

GBPUSD currently trading at 1.258 at the time of writing. Pair opened at 1.2601 and is trading with a change of -0.17 % .

The pair is trading below its 20 Daily moving average @ 1.2734, below its 50 Daily moving average @ 1.2793 , below its 100 Daily moving average @ 1.2638 and above its 200 Daily moving average @ 1.2396

The previous day high was 1.2729 while the previous day low was 1.2592. The daily 38.2% Fib levels comes at 1.2644, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.2676, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 1.2552, 1.2503, 1.2415
• Pivot resistance is noted at 1.2689, 1.2778, 1.2827

[/s2If]
Download Nehcap EAWe have two EAs that are operational on our LIVE accounts.

1. EA-FIX: Check out the details here. Download EA-FIX . EA-FIX is a non-grid HFT scalper.
2. EA-GROWTH: High quality low dd EA using trend grids. Download EA_GROWTHJoin Our Telegram Group

Share this:

• Facebook
• X

Like this:

Like Loading...