GBP/USD Forecast: Bearish breakout around the corner
Premium|Take advantage of 50% OFF on your first month.
Start your subscription and get access to all our original articles.
You have reached your limit of 5 free articles for this month.
Get Premium without limits for only $9.99 for the first month
Access all our articles, insights, and analysts.
UNLOCK OFFERGBP/USD Current price: 1.4002
- US Federal Reserve hawkish stance put the dollar on the bullish track.
- Brexit tensions related to the Northern Ireland Protocol undermine demand for the pound.
- GBP/USD is poised to extend its decline in the near-term.
The GBP/USD pair advanced during London trading hours, reaching an intraday high of 1.4132, helped by better than anticipated UK inflation data. The Consumer Price Index was up by 2.1% YoY in May, while the core reading hit 2%. The Retail Price Index in the same period hit 3.3% as expected. However, a hawkish US Federal Reserve sent the pair down to 1.3996, its lowest in over a month.
Brexit tensions related to the Northern Ireland Protocol, however, kept limiting the pound’s strength. UK negotiator David Frost asked the EU some “breathing space” to negotiate an agreement after the Union announced a ban on the sale of British sausages in Northern Ireland. The UK won’t publish macroeconomic data on Thursday.
GBP/USD short-term technical outlook
The GBP/USD pair has traded as low as 1.3997, now struggling to retain gains just above the 1.4000 mark. The 4-hour chart shows that sellers defended the 1.4100 area, in where a bearish 20 SMA is crossing below the 200 SMA. Technical indicators head vertically south, currently flirting with oversold readings. Nevertheless, the risk remains skewed to the downside, with further declines likely once below 1.3985, the immediate support level.
Support levels: 1.3985 1.3940 1.3890
Resistance levels: 1.4035 1.4080 1.4125
GBP/USD Current price: 1.4002
- US Federal Reserve hawkish stance put the dollar on the bullish track.
- Brexit tensions related to the Northern Ireland Protocol undermine demand for the pound.
- GBP/USD is poised to extend its decline in the near-term.
The GBP/USD pair advanced during London trading hours, reaching an intraday high of 1.4132, helped by better than anticipated UK inflation data. The Consumer Price Index was up by 2.1% YoY in May, while the core reading hit 2%. The Retail Price Index in the same period hit 3.3% as expected. However, a hawkish US Federal Reserve sent the pair down to 1.3996, its lowest in over a month.
Brexit tensions related to the Northern Ireland Protocol, however, kept limiting the pound’s strength. UK negotiator David Frost asked the EU some “breathing space” to negotiate an agreement after the Union announced a ban on the sale of British sausages in Northern Ireland. The UK won’t publish macroeconomic data on Thursday.
GBP/USD short-term technical outlook
The GBP/USD pair has traded as low as 1.3997, now struggling to retain gains just above the 1.4000 mark. The 4-hour chart shows that sellers defended the 1.4100 area, in where a bearish 20 SMA is crossing below the 200 SMA. Technical indicators head vertically south, currently flirting with oversold readings. Nevertheless, the risk remains skewed to the downside, with further declines likely once below 1.3985, the immediate support level.
Support levels: 1.3985 1.3940 1.3890
Resistance levels: 1.4035 1.4080 1.4125
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.