GBP/USD Forecast: Pound pressured by three factors, and more could come

  • GBP/USD is consolidating its losses on the lower ground amid Brexit concerns. 
  • UK data remains robust, but Brexit continues dominating the scene.
  • The pair continues trading below the potent downtrend resistance line. 

GBP/USD is trading in the lower half of the 1.3000s, pressured to the downside. There are three reasons for the slide to the lower part of the range.

The immediate trigger comes from the fresh inflation report for March. Headline, Consumer Price Index, disappointed with 1.9% against expectations for a rise to 2.0%. Core CPI also stalled at 1.8% YoY, below projections for an acceleration to 1.9%. Yesterday's OK jobs report is now forgotten. 

The second reason is stalled Brexit talks between the government and the opposition. Labour Leader Jeremy Corbyn said there is no agreement on the customs union and blamed the government for not changing its red lines. While Brexit was postponed to October 31st, the issue remains left, right and center.

The third reason is technical. The downtrend resistance line proved its strength over and over again in the past week, and it does not let go. Besides, the most recent fall also sent GBP/USD below the 50 Simple Moving Average on the four-hour chart, strengthening the bears.

GBP USD technical analysis April 17 2019

Support is found at the recent low of 1.3030. April's low of 1.2985 is next, and 1.2960 which was the low point in March, follows. 1.2895 and 1.2830 are next in line. 

Resistance awaits at 1.3120 that held Sterling down for quite a few sessions of late. The next cap is at the round number of 1.3200 which was the peak in April. 1.3270 is next.

Looking forward, Bank of England Governor Mark Carney speaks later on and will have the opportunity to respond to the latest figures. Also, the US releases its trade balance data, and FOMC member James Bullard speaks.

All in all, the bears seem to be in full control.

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.

Feed news

Latest Forex Analysis

Editors’ Picks

EUR/USD consolidates losses as Fed moderates message

EUR/USD is trading above 1.1350, consolidating losses. The Fed's Bullard and Chair Powell have conveyed a balanced message, boosting the greenback. Treasury Secretary Mnuchin said 90% of the deal with China is done.


GBP/USD trades below 1.2700

GBP/USD is trading below 1.2700. BOE Gov. Carney said the BOE may cut rates in case of a no-deal Brexit. Boris Johnson has rattled markets by saying leaving the EU by October 31st is "do or die."


USD/JPY sticks to gains near 107.70, looks to snap 7-day losing streak

Following the sharp upsurge witnessed during the European trading hours, the USD/JPY pair has gone into a consolidation phase and is now moving in a relatively tight range in the upper half of its daily trading range.


EIA: Crude inventories decreased by 12.8 million barrels, WTI inches closer to $60

In its weekly petroleum report for the week ending June 21, the Energy Information Administration (EIA) announced that the commercial crude oil inventories in the United States decreased by 12.8 million barrels from the previous week. 

Read more

Gold finds some support near $1400 mark, lacks follow-through

Gold held on to its weaker tone through the early North-American session, albeit pared a part of its intraday slide to the $1400 neighbourhood post-US economic data.

Gold News