Technical Analysis

GBP/USD Price Analysis – May 01, 2024

By LonghornFX Technical Analysis
May 1, 2024
Gbpusd

Daily Price Outlook

The GBP/USD currency pair has continued its downward trend, remaining well offered around the 1.2486 level and hitting an intra-day low of 1.2466. However, this downward movement can be attributed to several factors, including a bullish US dollar and the BOE's dovish stance on interest rates.

As the US Dollar strengthens ahead of the announcement, investors tend to favor the greenback over other currencies, including the British Pound. The Fed's decision to maintain interest rates steady and its hawkish stance contribute to the dollar's appeal, leading to a decline in the GBP/USD pair.

Moreover, economic indicators from the United States, such as the Consumer Price Index (CPI) and the Employment Cost Index, have shown stronger-than-expected performance. This suggests robust economic activity and reinforces expectations of higher interest rates, further bolstering the US Dollar and putting pressure on the Pound Sterling.

Furthermore, the downtrend in the currency pair was bolstered by speculation surrounding potential rate cuts by the Bank of England (BoE). This speculation, driven by various economic factors, significantly impacts the GBP/USD currency pair.

US Dollar Strengthens Ahead of Fed Policy Decision

On the US front, the broad-based US dollar prolonged its bullish rally and continues to show strength ahead of the US Federal Reserve (Fed) policy meeting. This rally was fueled by hawkish remarks from Fed officials, indicating no immediate need for rate cuts. Moreover, positive economic indicators from the United States, such as the higher-than-expected CPI and Employment Cost Index, contribute to the Dollar's strength.

These indicators show strong economic performance and reinforce the idea of higher interest rates in the future, further bolstering the US Dollar.

Speculation for BoE Rate Cuts Exert Pressure on Pound Sterling

On the BOE front, the downtrend in the pair was further bolstered by speculation surrounding potential rate cuts by the Bank of England (BoE). Traders and investors are closely monitoring statements from BoE officials and economic data releases to gauge the likelihood of future interest rate adjustments.

The anticipation of rate cuts, particularly in the upcoming June or August meetings, exerts downward pressure on the Pound Sterling against the US Dollar. BoE Governor Andrew Bailey's confidence in headline inflation returning to the 2% target in April further fuels expectations for monetary policy easing.

As the UK considers lowering borrowing costs, the Pound becomes less attractive compared to the US Dollar. This anticipation of BoE rate cuts contributes to the bearish performance of the GBP/USD pair, with investors adjusting their positions accordingly in response to shifting monetary policy expectations.

GBP/USD Price Chart - Source: Tradingview
GBP/USD Price Chart - Source: Tradingview

GBP/USD - Technical Analysis

Today, the GBP/USD pair is trading slightly lower at $1.24878, marking a decline of 0.06%. Positioned just below the pivot point of $1.25181, the pair shows tentative trading behavior amidst broader market fluctuations. Key technical levels delineate the immediate future course for the pound against the dollar.

Immediate resistance for the GBP/USD is noted at $1.25238, with subsequent barriers at $1.25795 and $1.26377. These levels must be breached to signal any substantial bullish momentum. Conversely, the support framework begins significantly lower at $1.23929, followed by further cushions at $1.23369 and $1.23006. These will be crucial if the pair undergoes further pullbacks.

The Relative Strength Index (RSI) is presently at 46, which points to a near-neutral market sentiment, suggesting that the currency pair is neither overbought nor oversold. Meanwhile, the 50-Day Exponential Moving Average (EMA) at $1.24612 supports the pair just below the current price, indicating that there might be a potential for upward correction provided the market conditions stabilize.

Considering the current market setup, it may be prudent to initiate a cautious buying position. Suggested trading strategy includes placing a buy order above $1.24598, aiming for a take profit at the pivot point of $1.25181, and setting a stop loss at $1.24096 to mitigate potential downside risks.

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GBP/USD

Daily Trade Ideas

GBP/USD Price Analysis and Trade Forecast: Daily Trading Signal

By LonghornFX Technical Analysis
Apr 29, 2024
Gbpusd

Daily Price Outlook

- Initiate a buy position if GBP/USD surpasses the 1.25159 mark, aiming for a profit target at 1.25812.

- Set a protective stop loss at 1.24653 to manage risk effectively.

- Keep a close watch on the RSI and 50 EMA for additional confirmation of the trend’s strength and sustainability.

In today’s trading session, the GBP/USD pair has appreciated notably, climbing by 0.43% to reach a current level of 1.25423. This movement places the currency pair just above a pivotal technical juncture observed on the 4-hour chart.

The pivot point for today is established at 1.25151. Holding above this level could serve as a springboard for GBP/USD, targeting the first immediate resistance at 1.25795. Should bullish momentum persist, further resistances are projected at 1.26377 and 1.27034, respectively. On the flip side, should the pair lose ground, it would first encounter support at 1.24498, with more substantial floors awaiting at 1.23929 and 1.23369 if the downtrend accelerates.

The technical indicators suggest a solidifying bullish bias; the Relative Strength Index (RSI) stands at 63, indicating growing momentum but still shy of the overbought territory. Furthermore, the 50-Day Exponential Moving Average (EMA) at 1.2470 now acts as a support level, reinforcing the upward trajectory since it resides below the current price.

GBP/USD Price Chart - Source: Tradingview
GBP/USD Price Chart - Source: Tradingview

GBP/USD - Trade Ideas

Entry Price – Buy Above 1.25159

Take Profit – 1.25812

Stop Loss – 1.24653

Risk to Reward – 1: 1.2

Profit & Loss Per Standard Lot = +$653/ -$506

Profit & Loss Per Mini Lot = +$65/ -$50

GBP/USD

Technical Analysis

GBP/USD Price Analysis – April 29, 2024

By LonghornFX Technical Analysis
Apr 29, 2024
Gbpusd

Daily Price Outlook

During the European trading session, the GBP/USD currency pair has been maintaining a positive trend and remained well bid around 1.2538, hitting the intraday high of 1.2549 level. However, the reason for its upward rally can be attributed to the weaker US Dollar, which lost its traction on the back of risk-on market sentiment. Investors are closely eyeing the upcoming Federal Open Market Committee (FOMC) interest rate decision and press conference scheduled for Wednesday.

Although, the losses in the US dollar could be short-lived as the US Federal Reserve (Fed) is widely expected to maintain the interest rate within its current range of 0.25%–0.5% during this week's meeting. Despite the strength of the US economy and the recent uptick in inflation, speculations suggest that the first rate cut might not occur until September.

US Dollar Weakness and Fed's Hawkish Stance:

Despite the Federal Reserve's hawkish stance on interest rates, the US Dollar is witnessing a decline and remains subdued amid positive market sentiment. Investors anticipate the Fed to maintain rates steady between 5.25% and 5.5%. Although the US economy exhibits strength, concerns over rising inflation have delayed expectations for rate cuts until September. Recent data from the US Bureau of Economic Analysis, showing a higher-than-expected increase in the Core PCE Price Index, further bolstered the Fed's hawkish expectations.

On the data front, the US Bureau of Economic Analysis reported on Friday that the Personal Consumption Expenditures (PCE) Price Index rose 0.3% in March, exceeding expectations for a reading of 2.6%. The yearly rate also climbed to 2.7% from 2.5% in February. Meanwhile, the core PCE Price Index, which excludes volatile food and energy prices, remained steady at 2.8%, higher than the anticipated 2.6%. These results reinforced the Federal Reserve's hawkish expectations and helps US dollar to limit its losses.

BoE Expected Rate Cuts and Impact on GBP/USD:

On the UK front, investors are starting to believe that the Bank of England (BoE) might lower interest rates at its June meeting. BoE Governor Andrew Bailey hinted that two or three rate cuts this year could happen, which made people think this way. If the BoE decides to cut rates, it could make the Pound Sterling weaker. However, the dovish shift in BoE's monetary policy stance could weaken the Pound Sterling (GBP) and cap further gains in the GBP/USD pair.

GBP/USD Price Chart - Source: Tradingview
GBP/USD Price Chart - Source: Tradingview

GBP/USD - Technical Analysis

In today’s trading session, the GBP/USD pair has appreciated notably, climbing by 0.43% to reach a current level of 1.25423. This movement places the currency pair just above a pivotal technical juncture observed on the 4-hour chart.

The pivot point for today is established at 1.25151. Holding above this level could serve as a springboard for GBP/USD, targeting the first immediate resistance at 1.25795. Should bullish momentum persist, further resistances are projected at 1.26377 and 1.27034, respectively. On the flip side, should the pair lose ground, it would first encounter support at 1.24498, with more substantial floors awaiting at 1.23929 and 1.23369 if the downtrend accelerates.

The technical indicators suggest a solidifying bullish bias; the Relative Strength Index (RSI) stands at 63, indicating growing momentum but still shy of the overbought territory. Furthermore, the 50-Day Exponential Moving Average (EMA) at 1.2470 now acts as a support level, reinforcing the upward trajectory since it resides below the current price.

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GBP/USD

Technical Analysis

GBP/USD Price Analysis – April 24, 2024

By LonghornFX Technical Analysis
Apr 24, 2024
Gbpusd

Daily Price Outlook

Despite the improved UK economic outlook, the GBP/USD currency pair has been experiencing a bearish trend and remained well-offered around the 1.2616 level, hitting the intraday low of 1.2422 level. This downward movement can be attributed to several factors, including the renewed strength of the US dollar, which gained traction despite the disappointing release of the US PMIs, suggesting that the economic upturn lost momentum at the start of the second quarter.

In contrast to this, the stronger-than-expected Services PMI could be bullish for the British Pound (GBP), suggesting a robust UK services sector. Meanwhile, the strong new business volumes suggest healthy consumer spending, potentially leading to increased inflation. This might prompt the Bank of England to maintain or increase interest rates, supporting a bullish outlook for the Pound Sterling.

Impact of Bank of England Policies and PMI Data on GBP/USD Pair Volatility

On the UK front, the Bank of England's (BoE) plans to delay cutting interest rates and strong preliminary PMI data for April have fueled demand for the Pound and helped the GBP/USD pair to limit its downside trend. However, the market is divided on whether rate cuts will start in June or August. According to James Smith from ING Financial Markets, the decision could lean towards August because of concerns about sticky services inflation. However, BoE deputy governor Dave Ramsden believes inflation could drop faster than expected, while BoE policymaker Jonathan Haskel remains concerned about persistent inflation due to a tight labor market.

Hence, the uncertainty surrounding the Bank of England's interest rate decisions and differing views among policymakers create volatility for the Pound (GBP), despite initial demand spurred by strong PMI data.

On the data front, the latest preliminary figures from S&P Global/CIPS show mixed results for April. The Services PMI, a measure of the health of the services sector, rose to 54.9, much higher than expected, indicating robust growth. This was a surprise because investors thought it would drop slightly. Meanwhile, the Manufacturing PMI, which tracks the manufacturing sector, fell below the critical 50.0 mark that separates expansion from contraction, coming in at 48.7. This is a sharp drop from earlier expectations and the previous reading of 50.3, indicating that the manufacturing sector may be contracting after months of growth.

Therefore, the mixed PMI data could create volatility in the GBP/USD pair. The strong Services PMI could boost the Pound, while the weaker Manufacturing PMI might lead to uncertainty, impacting the currency's strength against the US Dollar.

Impact of Federal Reserve Policies and PMI Data on the US Dollar and GBP/USD Pair

On the US front, the overall US dollar is gaining strength because people expect the Federal Reserve to keep interest rates high for longer, due to ongoing inflation concerns. Therefore, the expectation that the Federal Reserve will maintain high interest rates strengthens the US dollar, potentially leading to a decline in the GBP/USD pair as the British pound weakens against the dollar.

On the US data front, the S&P Global Composite PMI, which shows the health of the US private sector, dropped to 50.9 in April, indicating slower growth. Both the Manufacturing PMI and Services PMI also showed weakening activity, with the Manufacturing PMI even entering contraction territory. These numbers suggest that the US economy is experiencing reduced momentum in its business activity.

GBP/USD Price Chart - Source: Tradingview
GBP/USD Price Chart - Source: Tradingview

GBP/USD - Technical Analysis

In today's session, the GBP/USD pair edged up modestly, marking a slight increase of 0.03% to a current price of $1.24527. The pair has navigated close to its pivot point at $1.2386, which acts as a key reference for future price movement.

GBP/USD faces immediate resistance at $1.2526, followed by higher barriers at $1.2580 and $1.2638. These levels represent crucial points that could limit upward momentum. Conversely, the pair finds immediate support at $1.2407, with further supportive cues at $1.2349 and $1.2304. These supports could play a significant role should the currency experience a pullback.

The Relative Strength Index (RSI) is currently at 58, indicating a mildly bullish sentiment but nearing overbought conditions which could prompt a corrective pullback. The 50-day Exponential Moving Average (EMA) stands at $1.2431, slightly below the current price, suggesting a potential resistance zone around this average. Additionally, the presence of a doji candlestick pattern just below the downward trendline at approximately $1.2450 suggests that selling pressure could intensify.

The technical setup suggests a cautious approach to the GBP/USD pair, with a recommendation to initiate a sell position if the price drops below $1.24598. The target for taking profits is set at $1.23859, with a stop loss at $1.25123 to mitigate potential risks.

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GBP/USD

Daily Trade Ideas

GBP/USD Price Analysis and Trade Forecast: Daily Trading Signal

By LonghornFX Technical Analysis
Apr 24, 2024
Gbpusd

Daily Price Outlook

- GBP/USD Movement: Minor gain to $1.24527, nearing resistance at $1.2526 with support at $1.2407.

- Technical Indicators: RSI at 58 and 50 EMA at $1.2431 indicate near-term resistance could cap gains.

- Trading Strategy: Selling below $1.24598 advised, with profit target at $1.23859 and stop loss at $1.25123.

In today's session, the GBP/USD pair edged up modestly, marking a slight increase of 0.03% to a current price of $1.24527. The pair has navigated close to its pivot point at $1.2386, which acts as a key reference for future price movement.

GBP/USD faces immediate resistance at $1.2526, followed by higher barriers at $1.2580 and $1.2638. These levels represent crucial points that could limit upward momentum. Conversely, the pair finds immediate support at $1.2407, with further supportive cues at $1.2349 and $1.2304. These supports could play a significant role should the currency experience a pullback.

The Relative Strength Index (RSI) is currently at 58, indicating a mildly bullish sentiment but nearing overbought conditions which could prompt a corrective pullback. The 50-day Exponential Moving Average (EMA) stands at $1.2431, slightly below the current price, suggesting a potential resistance zone around this average. Additionally, the presence of a doji candlestick pattern just below the downward trendline at approximately $1.2450 suggests that selling pressure could intensify.

The technical setup suggests a cautious approach to the GBP/USD pair, with a recommendation to initiate a sell position if the price drops below $1.24598. The target for taking profits is set at $1.23859, with a stop loss at $1.25123 to mitigate potential risks.

GBP/USD Price Chart - Source: Tradingview
GBP/USD Price Chart - Source: Tradingview

GBP/USD - Trade Ideas

Entry Price – Sell Below 1.24598

Take Profit – 1.23859

Stop Loss – 1.25123

Risk to Reward – 1: 1.4

Profit & Loss Per Standard Lot = +$739/ -$525

Profit & Loss Per Mini Lot = +$73/ -$52

GBP/USD

Technical Analysis

GBP/USD Price Analysis – April 22, 2024

By LonghornFX Technical Analysis
Apr 22, 2024
Gbpusd

Daily Price Outlook

Despite the bearish US dollar, the GBP/USD currency pair was unable to stop its downward rally and hit an intraday low of 1.2350 level. However, the declines were mainly driven by increasing speculations about more aggressive policy easing by the Bank of England (BoE), which undermined the GBP currency and contributed to the losses in the GBP/USD pair.

On the flip side, expectations that the Federal Reserve (Fed) will keep rates higher for longer due to ongoing US inflation could help the US dollar limit its losses and may push the GBP/USD currency pair further down. In contrast to this, reduced geopolitical tensions boost investor confidence and weaken the safe-haven dollar, which might limit losses in the GBP/USD pair.

Fed Rate Expectations and Geopolitical Developments Impact on GBP/USD Pair

On the US front, the broad-based US dollar gained traction as the Federal Reserve (Fed) will keep interest rates higher for a longer time due to ongoing inflation concerns. This initially boosted the US dollar and contributed to declines in the GBPUSD pair. Traders now think the Fed might delay rate cuts until September and expect fewer cuts this year. This cautious stance boosts US Treasury bond yields, which strengthens the US dollar. Therefore, the expectation of prolonged higher rates by the Fed initially boosted the US dollar, leading to declines in GBP/USD.

On the geopolitical front, Iran indicated it won't retaliate against Israel's limited missile strike, calming concerns of heightened tensions in the Middle East. This boosts investor confidence, leading to a weakening of the safe-haven US dollar and providing support for the GBP/USD pair.

BoE Speculation and Policy Easing Impact on GBP/USD Pair

Another factor contributing to the GBP/USD pair's losing streak is the speculation around the Bank of England (BoE) adopting more aggressive policy easing measures. However, adopting more aggressive policy easing measures typically refers to potential rate cuts or other actions aimed at stimulating the economy. These measures can include lowering interest rates or implementing quantitative easing programs to increase liquidity in the financial system.

GBP/USD Price Chart - Source: Tradingview
GBP/USD Price Chart - Source: Tradingview

GBP/USD - Technical Analysis

The GBP/USD pair has recorded a slight uptick today, increasing by 0.10% to $1.23810. This move reflects subtle shifts in market sentiment as traders navigate a critical technical landscape for the British Pound against the U.S. Dollar.

The pair is currently trading below the key pivot point set at $1.24204, which serves as a gauge for directional bias in the session. Looking upwards, immediate resistance can be found at $1.24823, followed by $1.25261 and $1.25795. These levels could serve as ceilings for price actions where sellers might regain control. On the downside, the initial support is marked at $1.23324. Should bearish pressures intensify, subsequent supports at $1.22949 and $1.22575 will be crucial to halting further declines.

The Relative Strength Index (RSI) stands at 36, suggesting that the GBP/USD pair is approaching oversold territory, which could potentially lure buyers back into the market. However, the 50-day Exponential Moving Average (EMA) at $1.24747 remains above the current price, indicating an overarching bearish bias in the medium term.

Given the current technical setup, a prudent trading strategy would involve initiating a short position if the pair rises to just below the pivotal $1.24208 mark, targeting a pullback towards $1.23433. To manage risk effectively, setting a stop loss at $1.24758 is advisable, safeguarding against potential upward swings beyond the immediate resistance.

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GBP/USD

Daily Trade Ideas

GBP/USD Price Analysis and Trade Forecast: Daily Trading Signal

By LonghornFX Technical Analysis
Apr 22, 2024
Gbpusd

Daily Price Outlook

- GBP/USD experiences minor gain to $1.23810, trading below pivotal resistance at $1.24204.

- Resistance levels to watch are $1.24823, $1.25261, and $1.25795; support levels are at $1.23324, $1.22949, and $1.22575.

- Strategy suggests a short sell below $1.24208, targeting $1.23433, with a stop loss at $1.24758 to mitigate potential losses.

The GBP/USD pair has recorded a slight uptick today, increasing by 0.10% to $1.23810. This move reflects subtle shifts in market sentiment as traders navigate a critical technical landscape for the British Pound against the U.S. Dollar.

The pair is currently trading below the key pivot point set at $1.24204, which serves as a gauge for directional bias in the session. Looking upwards, immediate resistance can be found at $1.24823, followed by $1.25261 and $1.25795. These levels could serve as ceilings for price actions where sellers might regain control. On the downside, the initial support is marked at $1.23324. Should bearish pressures intensify, subsequent supports at $1.22949 and $1.22575 will be crucial to halting further declines.

The Relative Strength Index (RSI) stands at 36, suggesting that the GBP/USD pair is approaching oversold territory, which could potentially lure buyers back into the market. However, the 50-day Exponential Moving Average (EMA) at $1.24747 remains above the current price, indicating an overarching bearish bias in the medium term.

Given the current technical setup, a prudent trading strategy would involve initiating a short position if the pair rises to just below the pivotal $1.24208 mark, targeting a pullback towards $1.23433. To manage risk effectively, setting a stop loss at $1.24758 is advisable, safeguarding against potential upward swings beyond the immediate resistance.

GBP/USD Price Chart - Source: Tradingview
GBP/USD Price Chart - Source: Tradingview

GBP/USD - Trade Ideas

Entry Price – Sell Below 1.24208

Take Profit – 1.23433

Stop Loss – 1.24758

Risk to Reward – 1: 1.4

Profit & Loss Per Standard Lot = +$775/ -$550

Profit & Loss Per Mini Lot = +$77/ -$55

GBP/USD

Daily Trade Ideas

GBP/USD Price Analysis and Trade Forecast: Daily Trading Signal

By LonghornFX Technical Analysis
Apr 17, 2024
Gbpusd

Daily Price Outlook

- GBP/USD sees an uptick to 1.24394, hinting at cautious market optimism amidst mixed economic signals.

- Resistance observed at 1.2470, with potential upward moves eyeing 1.2512 and 1.2568.

- Recommended strategy: Buy above 1.24198, with targets at 1.25114 and stop loss at 1.23728.

On April 17, the GBP/USD pair experienced a slight increase, closing at 1.24394, up by 0.10%. This modest gain suggests a tentative optimism among traders as they navigate a mix of economic signals from both the UK and the US. Currently, the pair is trading below the pivotal level of 1.2511, which acts as a key juncture for future price movements.

Immediate resistance is established at 1.2470, with subsequent levels at 1.2512 and 1.2568. A breach of these resistance points could signal a strengthening of the bullish momentum. On the downside, the pair finds initial support at 1.2375. Further declines could see the GBP/USD testing support at 1.2332 and 1.2295, potentially reinforcing a bearish trend if these levels are penetrated.

The Relative Strength Index (RSI) at 37 suggests that the currency pair is nearing oversold territory, indicating potential for an upward correction if bullish triggers are present in the market. The 50-day Exponential Moving Average (EMA) at 1.2552 also supports this view, as it lies just above the current price level, hinting at underlying buying pressure.

Given the technical setup, a prudent trading strategy would be to initiate a buy position if the GBP/USD moves above 1.24198, targeting a profit at 1.25114, while setting a stop loss at 1.23728 to manage potential downside risks.

GBP/USD Price Chart - Source: Tradingview
GBP/USD Price Chart - Source: Tradingview

GBP/USD - Trade Ideas

Entry Price – Buy Above 1.24198

Take Profit – 1.25114

Stop Loss – 1.23728

Risk to Reward – 1: 1.9

Profit & Loss Per Standard Lot = +$916/ -$470

Profit & Loss Per Mini Lot = +$91/ -$47

GBP/USD

Technical Analysis

GBP/USD Price Analysis – April 17, 2024

By LonghornFX Technical Analysis
Apr 17, 2024
Gbpusd

Daily Price Outlook

Despite the bullish US dollar, the GBP/USD currency pair has managed to stop its downward trend and has been showing a bullish trend, reaching around the $1.2430 level. However, the reason for its upward movement is the positive performance of the UK Consumer Price Index (CPI). In March, the CPI rose by 3.2%, exceeding market expectations of 3.1%. This upbeat economic indicator has bolstered confidence in the British economy, leading to increased demand for the Pound Sterling (GBP) and pushing the pair higher.

In contrast to this, the stronger US dollar and the Federal Reserve's hawkish stance on rate cuts were seen as one of the key factors that kept the lid on any additional gains in the GBP/USD pair.

Positive UK CPI Data Supports GBP/USD Pair Amid Economic Confidence

On the data front, the United Kingdom's Consumer Price Index (CPI) rose by 3.2% year-over-year in March, slightly slower than the 3.4% increase in February but beating expectations of a 3.1% rise. The Core CPI, which excludes volatile items like food and energy, grew by 4.2% annually, lower than February's 4.5% but above the anticipated 4.1%. March's Services CPI increased by 6.0% compared to the previous year, slightly down from February's 6.1% growth. Month-on-month, UK inflation stayed steady at 0.6% in March, matching February's rate. T

Therefore, the positive UK CPI data, despite a slight slowdown in growth, supported the GBP/USD pair, pushing it towards the $1.2450 level due to increased confidence in the British economy.

GBP/USD Pair Faces Downward Pressure from Hawkish Fed Comments and Strong US Retail Sales

On the other side of the pair, the broad-based US Dollar has seen upside momentum due to comments from Federal Reserve (Fed) Chair Jerome Powell. Powell's hawkish stance on monetary policy, emphasizing the need for a longer period of restrictive measures, has strengthened the US dollar. In addition to this, positive US Retail Sales data has further boosted confidence in the American economy, exerting pressure on the GBP/USD pair.

On the data front, US Building Permits dropped to 1.458 million in March, below the expected 1.514 million, while Housing Starts fell to 1.321 million, missing the anticipated 1.480 million. However, US Retail Sales rose by 0.7% in March, surpassing expectations of 0.3% and revised upwards from 0.6% in February.

Therefore, the GBP/USD pair faced downward pressure from Jerome Powell's hawkish comments and positive US Retail Sales data, strengthening the US dollar against the British pound.

Bank of England Rate Cut Expectations Impact GBP/USD Pair

On the UK front, Investors have been pricing in the possibility of two rate cuts by the Bank of England (BoE) within this year, with expectations of the first cut potentially in August or September. This anticipation has created uncertainty in the forex market, leading to some selling pressure on the Pound (GBP) and impacting the GBP/USD pair's performance.

Therefore, the expectations of rate cuts by the Bank of England have introduced uncertainty, creating selling pressure on the Pound (GBP) and influencing the performance of the GBP/USD pair.

GBP/USD Price Chart - Source: Tradingview
GBP/USD Price Chart - Source: Tradingview

GBP/USD - Technical Analysis

On April 17, the GBP/USD pair experienced a slight increase, closing at 1.24394, up by 0.10%. This modest gain suggests a tentative optimism among traders as they navigate a mix of economic signals from both the UK and the US. Currently, the pair is trading below the pivotal level of 1.2511, which acts as a key juncture for future price movements.

Immediate resistance is established at 1.2470, with subsequent levels at 1.2512 and 1.2568. A breach of these resistance points could signal a strengthening of the bullish momentum. On the downside, the pair finds initial support at 1.2375. Further declines could see the GBP/USD testing support at 1.2332 and 1.2295, potentially reinforcing a bearish trend if these levels are penetrated.

The Relative Strength Index (RSI) at 37 suggests that the currency pair is nearing oversold territory, indicating potential for an upward correction if bullish triggers are present in the market. The 50-day Exponential Moving Average (EMA) at 1.2552 also supports this view, as it lies just above the current price level, hinting at underlying buying pressure.

Given the technical setup, a prudent trading strategy would be to initiate a buy position if the GBP/USD moves above 1.24198, targeting a profit at 1.25114, while setting a stop loss at 1.23728 to manage potential downside risks.

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GBP/USD

Daily Trade Ideas

GBP/USD Price Analysis and Trade Forecast: Daily Trading Signal

By LonghornFX Technical Analysis
Apr 15, 2024
Gbpusd

Daily Price Outlook

- GBP/USD tests key pivot at 1.25208; potential resistance up to 1.28964.

- Support established at 1.23731, with further downside protection at 1.23060 and 1.21924.

- Current trading strategy suggests buying above 1.24606, targeting 1.25500, stop loss at 1.24165.

On April 15, the GBP/USD pair recorded a modest rise, closing the session up 0.14% at 1.24632. The pair is currently navigating the forex market waters with a cautious optimism, positioned just below a crucial pivot point at 1.25208. Should the pair breach this pivot, it could encounter resistance levels at 1.26795, 1.27828, and 1.28964. These levels represent significant thresholds that could impede upward movement, but also signal potential entry points for bullish traders.

On the downside, immediate support lies at 1.23731. Further dips could be cushioned by support at 1.23060 and more critically at 1.21924. These supports are crucial in preventing a steeper decline and offer strategic points for stop-loss settings in trading scenarios.

The technical indicators suggest a nuanced outlook: while the Relative Strength Index (RSI) details were not provided, the positioning of the 50-day Exponential Moving Average (EMA) at 1.26381 slightly above the current price hints at underlying bearish pressures. However, if the GBP/USD can sustain above its current levels, particularly if it stays above the strategically set entry price of 1.24606, the forecast is inclined towards a bullish bias. Traders might consider a buying strategy with a target at 1.25500 and a stop loss at 1.24165 to manage risk.

GBP/USD Price Chart - Source: Tradingview
GBP/USD Price Chart - Source: Tradingview

GBP/USD - Trade Ideas

Entry Price – Buy Above 1.24606

Take Profit – 1.25500

Stop Loss – 1.24165

Risk to Reward – 1: 2

Profit & Loss Per Standard Lot = +$894/ -$441

Profit & Loss Per Mini Lot = +$89/ -$44

GBP/USD