GBP/USD Forecast: A bullish continuation depends on the greenback

Valeria Bednarik FXStreet

GBP/USD Current Price: 1.2183

The Bank of England left its monetary policy unchanged, opened doors for further easing.
The number of coronavirus cases in the UK on the rise after the government’s late response.
GBP/USD broke above the 38.2% retracement of its March decline at 1.2090.

The GBP/USD pair soared to 1.2196, its highest since March 17, as speculative interest continued to dump the greenback. The Bank of England held this Thursday its usual monetary policy meeting, although it left its monetary policy unchanged, as expected. The MPC unanimously voted to keep rates at 0.10% and the APP at £ 645B and left doors open to expand its facilities program.

Blind demand for the greenback has finally eased amid the latest measures announced by the US, although the pandemic is far from over, with the number of cases worldwide above 500,000. The UK is yet to see the worst of it, after calling for a lockdown too late. The latest data available indicates that the number of cases in the kingdom rose to 11,658, while the death toll hit 578. This Friday, the UK will release March Nationwide Housing Prices.

GBP/USD short-term technical outlook

The GBP/USD pair has retreated from the mentioned high but holds well above 1.2090, the 38.2% retracement of March’s decline. In the 4-hour chart, the pair has advanced well above its 20 SMA but remains below the 100 and 200 SMA, with the shortest, now converging with the 50.0% retracement of the mentioned slide at 1.2300. Technical indicators are easing from overbought levels, but remain well above their mid-lines. The bullish potential will suffer if the pair falls below the mentioned 1.2090.

Support levels: 1.2140 1.2090 1.2050

Resistance levels: 1.2230 1.2265 1.2300

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.

EUR/USD flat lines below 1.1900; divergent Fed-ECB expectations offer support

The EUR/USD pair struggles to capitalize on the overnight bounce from the 1.1835-1.1830 region and oscillates in a narrow band during the Asian session on Thursday. Spot prices currently trade around the 1.1875 area, remaining nearly unchanged for the day and staying within striking distance of an over one-week high, reached on Tuesday, amid mixed cues.

GBP/USD slips heading into the Thursday trading window

The Pound Sterling pulled back from four-year highs on Wednesday, weighed down by a combination of Bank of England dovishness and UK political uncertainty, even as the US Dollar weakened on soft labor market revisions.

Gold holds losses near $5,050 despite renewed USD selling

Gold price trades in negative territory near $5,050 in Thursday's Asian session. The precious metal faces headwinds from stronger-than-expected US employment data, even as the US Dollar sees a bout of fresh selling. All eyes now remain on the next batch of US labor statistics.

Crypto trades through a confidence reset

The cryptocurrency market is navigating a liquidity-driven reset rather than a narrative-driven rally. Bitcoin, Ethereum and major altcoins remain under pressure even as new exchange-traded fund filings continue and selected inflow days appear on the tape.

The market trades the path not the past

The payroll number did not just beat. It reset the tone. 130,000 vs. 65,000 expected, with a 35,000 whisper. 79 of 80 economists leaning the wrong way. Unemployment and underemployment are edging lower. For all the statistical fog around birth-death adjustments and seasonal quirks, the core message was unmistakable. The labour market is not cracking.

XRP sell-off deepens amid weak retail interest, risk-off sentiment

Ripple (XRP) is edging lower around $1.36 at the time of writing on Wednesday, weighed down by low retail interest and macroeconomic uncertainty, which is accelerating risk-off sentiment.