GBP/USD analysis: BOE hurt Pound´s demand, employment next

Valeria Bednarik FXStreet

GBP/USD Current price: 1.3540

The UK will release its latest employment figures and the Inflation Hearings report next Tuesday.
GBP suffered after the BOE cut inflation and growth forecasts.

The GBP/USD pair spent the week consolidating at its lowest in 4 months, unable to gather momentum from broad dollar's weakness, as Pound bulls were disappointed by a dovish, on-hold BOE. The central bank kept rates unchanged as expected after the latest batch of soft UK data, but also cut its inflation and growth forecasts for this year and the next, reducing odds of a hike in the second half of the year. The UK will release its latest employment data next Tuesday, the event with most chances of affecting the Pound this week. Wages are expected to have posted a modest advance in the three-month to March, which coupled with easing inflation, will further dent chances of a rate hike in the UK. The kingdom will also release its Inflation Hearing Reports on the same day. In the meantime, the daily chart shows that the pair has been pivoting around the current level with no definitions ever since the week started, which helped technical indicators correct partially extreme oversold conditions, falling short, however, of suggesting a bottom has been placed, as such indicators remain directionless well into negative territory, while the 20 DMA maintains a strong bearish slope far above the current level. In the 4 hours chart, the technical outlook is neutral for the short-term, as the pair keeps hovering around a flat 20 SMA, while technical indicators move back and forth around their mid-lines, failing to provide clear directional clues. The pair fell this past week to 1.3459, making of the level a strong support and the level to break to anticipate a downward extension ahead.

Support levels: 1.3500 1.3460 1.3420

Resistance levels: 1.3590 1.3620 1.3665

View Live Chart for the GBP/USD

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

GBP/USD hits multi-week tops around 1.3560

GBP/USD gathers fresh steam and advances to new three-month peaks near the 1.3560 zone on Friday. Cable’s sharp move higher comes after three daily drops in a row and follows the increasing selling pressure hurting the Greenback.

EUR/USD pops to fresh two-month highs, targets 1.1600

EUR/USD advances markedly, revisiting the upper 1.1500s for the first time since mid-June. The pair’s sharp uptick comes on the back of a strong retracement in the US Dollar amid BoJ intervention chatter and despite steady uncertainty in the Middle East.

Gold picks up pace, approaches $4,400

Gold rebounds toward the $4,400 mark per troy ounce on Friday, reversing the previous day’s pullback. The precious metal’s recovery comes as fresh and intense weakness keep weighing on the US Dollar, while traders keep assessing easing expectations of an imminent Fed interest rate hike and the situation from the Middle East.

Pi Network Price Forecast: PI extends consolidation as bulls eye $0.10

Pi Network (PI) price holds steady on Friday, maintaining a consolidating tone for three consecutive days. Mild retail strength in the PI token remains stable, with Open Interest above $9 million, while social buzz eases. PI token’s technical outlook is mixed, as bearish momentum wanes to neutral, with bulls eyeing the $0.1000 psychological level.

Weekly focus: Some relief in US inflation concerns

Actual inflation data for July came out as expected with a 0.1% m/m increase in headline CPI and 0.2% excluding food and energy. Annual headline inflation remains too high at 3.4% and means that wage earners are experiencing stagnating spending power at best, and core inflation is a bit higher than the inflation target of two percent would suggest.

Why is Crude Oil priced for a reopening the ships haven't made?

Fourteen vessels crossed the Strait of Hormuz on Tuesday. Before the war, the count ran near 120 a day. In the sessions since the waterway was publicly declared open, Brent has drifted back to $87 and West Texas Intermediate (WTI) to $81, both a little lower again on Wednesday, with daily momentum on each unwound from the top of its range in late July to the low twenties now.