GBP/USD Forecast: Chances are on the upside, with gains beyond 1.4200 on the cards

Valeria Bednarik FXStreet

GBP/USD Current price: 1.4159

BOE’s Governor Bailey said they would be watching inflation “very carefully.”
UK health officials noted that local vaccines are effective against the Indian strain.
GBP/USD is neutral in the near-term, but bulls hold the grip.

The GBP/USD pair ended Monday little changed in the 1.4150 price zone, up from a daily low of 1.4111. The advance was a result of a weaker dollar, which in turn followed the lead of US government bond yields. Good news coming from the UK did not reach the FX board. Still, the UK reported that the number of shoppers across the kingdom was up 1.1% in the week ended May 22 amid the reopening of indoor hospitality.

Also, local health officials said on Sunday that restrictions could be lifted by the end of June, as an official study found that the Pfizer and AstraZeneca vaccines offer effective protection against the Indian strain currently circulating in the kingdom. BOE’s Governor Andrew Bailey commented on inflation, noting that data on employment showed that the corner has been turned, adding that they will be watching inflation “very carefully.”

The UK will publish April’s Public Sector Net Borrowing on Tuesday, foreseen at £13.566 billion from £27.271 billion in the previous month.

GBP/USD short-term technical outlook

From a technical point of view, the GBP/USD pair is neutral. In the 4-hour chart, the pair is hovering around a mildly bearish 20 SMA but holding above the longer ones, which maintain their bullish slopes. Technical indicators are just above their midlines but without directional strength. Bulls need to push the pair beyond 1.4175 to see it gather additional momentum, while the risk will turn to the downside on a clear break below 1.4100.

Support levels:1.4095 1.4065 1.4020

Resistance levels: 1.4175 1.4220 1.4260

View Live Chart for the GBP/USD

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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.

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