Daily Price Outlook

The GBP/USD currency pair stopped its three-day winning trend and is currently around 1.2720 on Friday. This is happening because retail sales data from the UK, showing weaker numbers, has pushed the pair down. Furthermore, there is a caution sentiment due to increased risk aversion, strong US Treasury yields, and ongoing economic issues in China, all of which are putting pressure on GBP/USD.

These factors might make the US Dollar stronger and could affect the direction of the pair. Traders might be more careful after UK inflation numbers, which were released on Wednesday. These numbers have already boosted the pair, and there's worry they might lead the Bank of England (BoE) to consider raising interest rates in their September meeting.

UK Retail Sales Drop More Than Expected, Pressuring GBP/USD

According to the latest data from the Office for National Statistics (ONS), UK Retail Sales took a 1.2% tumble in July compared to the expected decrease of 0.5%. This decline follows a 0.6% growth in the previous month. The Core Retail Sales, which excludes car fuel sales, also saw a drop of 1.4% in July, worse than the anticipated decrease of 0.7%.

On a yearly basis, Retail Sales went down by 3.2% in July, more than the expected 2.1% decrease, while Core Retail Sales fell 3.4%, surpassing the expected 2.2% drop. These disappointing numbers have pushed GBP/USD to test daily lows around 1.2725, trading at 1.2727 with a 0.09% decline for the day.

US Dollar Pulls Back Despite Positive Data; Market Cautious About Inflation Clues

The broad-based US dollar is giving back some of its recent gains. The DXY, which tracks the dollar against major currencies, is hovering around 103.40. However, this retreat comes despite better US data, creating caution in the market as it looks for more clues about inflation. For instance, Initial Jobless Claims for the week ending on August 11 decreased to 239K from the previous 250K, slightly beating the expected 240K. Meanwhile, the Philadelphia Fed Manufacturing Survey for August showed improvement, rising to 12 from the earlier -13.5, higher than the anticipated -10.

Key Data Releases and Jackson Hole Symposium Await in the Upcoming Week

Looking forward to the next week, investors will keep an eye on important data releases in the US and the UK. In the US, Home Sales figures and early S&P Global PMI surveys for August will be in focus. Similarly, the UK will release its PMI survey and GfK Consumer Confidence data for August. These numbers will give us a clearer picture of how both economies are doing and could influence decisions about trading the GBP/USD pair.

GBP/USD - Technical analysis

The GBP/USD pair has successfully breached the resistance line of the bearish channel and established itself above it, signaling an attempt to achieve intraday gains. However, it's noteworthy that the stochastic indicator has shifted from positive momentum to a negative overlap, indicating the potential for a resumption of the corrective bearish trend. This trend is directed towards the 1.2625 region as the next key target.

As a result, it is anticipated that the upcoming trading sessions may witness downward movement. To facilitate progress towards the aforementioned target, a breakthrough of the 1.2725 level is crucial. Conversely, surpassing the 1.2825 threshold would halt the negative projection and prompt a reversal towards higher levels.

The projected trading range for today is expected to be positioned between the support at 1.2660 and the resistance at 1.2825.

Daily Price Outlook

The GBP/USD pair has successfully breached the resistance line of the bearish channel and established itself above it, signaling an attempt to achieve intraday gains. However, it's noteworthy that the stochastic indicator has shifted from positive momentum to a negative overlap, indicating the potential for a resumption of the corrective bearish trend. This trend is directed towards the 1.2625 region as the next key target.

As a result, it is anticipated that the upcoming trading sessions may witness downward movement. To facilitate progress towards the aforementioned target, a breakthrough of the 1.2725 level is crucial. Conversely, surpassing the 1.2825 threshold would halt the negative projection and prompt a reversal towards higher levels.

The projected trading range for today is expected to be positioned between the support at 1.2660 and the resistance at 1.2825.

GBP/USD - Trade Idea

Entry Price – Sell Below 0.64343

Take Profit – 0.63331

Stop Loss – 0.65008

Risk to Reward – 1: 1.50

Profit & Loss Per Standard Lot = +$1012/ -$665

Profit & Loss Per Micro Lot = +$101/ -$66

Daily Price Outlook

The GBP/USD pair adeptly met our initial forecasted target at 1.2625, encountering robust support at this juncture. This was accompanied by a transient bullish inclination. Intriguingly, the stochastic indicator has unmistakably lost its upward drive, while the EMA50 consistently exerts downward pressure on the currency's valuation.

Given these dynamics, our prognosis leans towards a bearish trajectory for the ensuing phase. For this forecast to materialize, the pair must decisively penetrate the aforementioned 1.2625 mark, setting its sights on 1.2505 as the subsequent bearish milestone. It's crucial to underscore that any surge beyond 1.2725, and subsequently 1.2825, would negate this bearish outlook, potentially catalyzing an upward price movement.

GBP/USD - Trade Idea

Entry Price – Buy Stop 1.27289

Take Profit – 1.27931

Stop Loss – 1.26644

Risk to Reward – 1: 1

Profit & Loss Per Standard Lot = +$642/ -$645

Profit & Loss Per Micro Lot = +$64/ -$64

Daily Price Outlook

Despite the strong performance of the US dollar, the GBP/USD currency pair has continued its upward trend, gaining considerable momentum and surpassing the 1.2712 level. This upward movement has been bolstered by the encouraging economic growth figures recently released in the UK.

Furthermore, positive developments in wage growth and an unexpected positive outcome in Employment Change have created a favorable environment for the British pound. However, it's worth noting that the ongoing strength of the US dollar has acted as a limiting factor, capping further gains in the the GBP/USD pair.

UK Wage Growth and BoE Outlook Impact on GBP/USD Pair

Moreover, the Chartered Institute of Personnel and Development in the UK recently conducted a survey, and their findings have added another interesting layer to the ongoing story. According to the survey, HR executives are anticipating a solid 5% increase in basic pay rates. This steady upward trend in wages aligns with the optimistic outlook for the Bank of England (BoE).

All eyes are now eagerly awaiting the release of the upcoming UK wage growth data. The predictions are pointing towards a potentially record-breaking high in wage growth for the month of July. Hence, the strong outcome from this data will likely enhance the prospects of a BoE interest rate hike in November, a move that could have a positive impact on the value of the British Pound.

However, it's important to acknowledge the flip side as well. If the wage growth data falls short of expectations, there might be concerns about a potential economic recession. This could result in a shift in sentiment, leading the GBP/USD currency pair to move in the opposite direction, as market participants reassess the economic landscape.

US Dollar Strength Impacts GBP/USD Amidst Fed's Stance and Global Factors

Moreover, traders are treading cautiously when it comes to betting on the GBP/USD pair due to the robust stance of the US Dollar. The USD Index (DXY), which measures the dollar against other currencies, is lingering around a two-month peak achieved earlier this week. This is mainly because of the widespread belief that the Federal Reserve intends to stick with higher interest rates for the foreseeable future. This sentiment got a boost from US data indicating ongoing challenges in reaching the Fed's 2% inflation target.

GBP/USD - Technical analysis

The GBP/USD pair adeptly met our initial forecasted target at 1.2625, encountering robust support at this juncture. This was accompanied by a transient bullish inclination. Intriguingly, the stochastic indicator has unmistakably lost its upward drive, while the EMA50 consistently exerts downward pressure on the currency's valuation.

Given these dynamics, our prognosis leans towards a bearish trajectory for the ensuing phase. For this forecast to materialize, the pair must decisively penetrate the aforementioned 1.2625 mark, setting its sights on 1.2505 as the subsequent bearish milestone. It's crucial to underscore that any surge beyond 1.2725, and subsequently 1.2825, would negate this bearish outlook, potentially catalyzing an upward price movement.

Daily Price Outlook

The GBP/USD currency pair continues to show sluggish trading, maintaining its consolidation around the 1.2715-20 range. Traders are exercising caution in light of the imminent US July inflation data Furthermore, news of the UK's move to limit investments in Chinese tech companies weighs on the Pound Sterling. In the meantime, the concerns about a possible British recession and the potential for increased rates in London are further dampening the performance of the Cable pair. These combined factors are fostering a cautious approach among GBP/USD traders

UK Political Moves, Economic Forecasts, and Their Impact on GBP/USD

According to the Financial Times (FT), UK Prime Minister Rishi Sunak is considering limiting investments in China's tech sector, aligning with US President Joe Biden's approach. This move comes as Sunak aims to regain political support following recent by-election setbacks.

Meanwhile, the National Institute of Economic and Social Research (NIESR) predicts British output to recover to pre-pandemic levels by Q3 2024, with a 60% chance of an election during a recession. On a positive note, NIESR expects UK inflation to exceed the Bank of England's 2.0% target for four years, potentially prompting actions to support the British Pound (GBP) by the central bank.

Therefore, this news of UK PM Sunak considering limits on Chinese tech investment, along with NIESR's prediction of British output recovery by Q3 2024 and potential election risks, could create uncertainty for GBP/USD.

Market Uncertainty Amid CPI and GDP Anticipation, US-China Tensions, and Central Bank Doubts

Market sentiment remains uncertain as traders anticipate the US Consumer Price Index (CPI) and UK's Q2 GDP results, while tensions between the US and China persist. US President Biden signed a bill limiting investments in Chinese entities, prompting concerns from China.

GBP/USD - Technical Analysis

The GBP/USD pair successfully breached the 1.2725 level and concluded the daily candlestick below it. This development reinforces the anticipation of a sustained bearish trend in the forthcoming trading sessions, thereby paving the way for a potential move towards 1.2825 as the next downside target.

The influence of the EMA50 indicator continues to align with the projected bearish wave. It's noteworthy that surpassing the 1.2725 level would alleviate the present downward pressure, initiating potential recovery attempts aimed at reaching the 1.2825 regions initially.

For today's trading outlook, the projected range is set between the support level of 1.2625 and the resistance level of 1.2790.

Daily Price Outlook

The GBP/USD pair successfully breached the 1.2725 level and concluded the daily candlestick below it. This development reinforces the anticipation of a sustained bearish trend in the forthcoming trading sessions, thereby paving the way for a potential move towards 1.2825 as the next downside target.

The influence of the EMA50 indicator continues to align with the projected bearish wave. It's noteworthy that surpassing the 1.2725 level would alleviate the present downward pressure, initiating potential recovery attempts aimed at reaching the 1.2825 regions initially.

For today's trading outlook, the projected range is set between the support level of 1.2625 and the resistance level of 1.2790.

GBP/USD - Trade Idea

Entry Price – Buy Stop 1.28112

Take Profit – 1.29034

Stop Loss – 1.26950

Risk to Reward – 1: 0.80

Profit & Loss Per Standard Lot = +$922/ -$1162

Profit & Loss Per Micro Lot = +$92/ -$116

Daily Price Outlook

In the preceding sessions, the GBP/USD pair demonstrated new positive movements leading to a breach of the 1.2725 level. However, it's important to note that the 50-day Exponential Moving Average (EMA50) posed significant resistance to the price, thereby stalling the ascent and maintaining the double top pattern in play. The pair now appears poised to resume the bearish trend, with the next principal target situated at 1.2625.

The Stochastic Oscillator is exhibiting negative indications that support the continuation of the predicted bearish trend. However, it should be noted that a breach of the 1.2825 level could halt the bearish wave and prompt the price to reverse course and rise.

Today's anticipated trading range is between the 1.2650 support and 1.2800 resistance levels.

The market trend for today is expected to be bearish.

GBP/USD - Trade Idea

Entry Price – Sell Limit 1.27578

Take Profit – 1.26543

Stop Loss – 1.28457

Risk to Reward – 1: 1.50

Profit & Loss Per Standard Lot = +$1035/ -$879

Profit & Loss Per Micro Lot = +$103/ -$87

Daily Price Outlook

Yesterday, the GBP/USD pair experienced a bearish trend, successfully reaching the initial target at 1.2725, and even closing below it. This development strengthens the possibility of a continued downward correctional trend, with the next significant target at 1.2625.

The formation of a Double Top pattern signals further negativity, potentially leading the price to test 1.2500. As long as the price remains below 1.2835, the bearish trend is likely to persist.

For today's trading, we expect the GBP/USD to move within the range of support at 1.2620 and resistance at 1.2790. Our analysis indicates a bearish trend for today's session.

GBP/USD - Trade Idea

Entry Price – Sell Below 1.27278

Take Profit – 1.26003

Stop Loss – 1.28268

Risk to Reward – 1: 1.29

Profit & Loss Per Standard Lot = +$1275/ -$990

Profit & Loss Per Micro Lot = +$127/ -$99

Daily Price Outlook

The GBP/USD currency pair experienced a bearish consolidation during the Asian session on Thursday. It remained within a narrow range, below a one-month low at 1.2640. The GBP/USD pair is currently around 1.2638, and traders appear cautious, refraining from taking aggressive positions as they await the upcoming monetary policy update from the Bank of England (BoE) later today. This update will likely have a major effect on the market, so traders are being cautious and watching closely before making any major moves in the GBP/USD pair.

UK Inflation Rate and Its Impact on GBP/USD Pair

According to the latest data, the UK's headline inflation rate decreased to 7.9% YoY in June, down from the previous 8.7%. This might lead the UK central bank to consider a smaller 25 bps interest rate increase, pushing the benchmark rate to 5.25%, the highest since December 2007. However, some investors are anticipating a more significant 50 bps rate hike due to persistent inflation above the Bank of England's (BoE) 2% target. As a result, all eyes will be on the monetary policy statement and press conference for clues about the future rate hike path. Thus, the growing expectations will significantly impact the British Pound and give a new direction to the GBP/USD pair.

USD Bullish Sentiment Weighs on GBP/USD Pair

The broad-based US Dollar is experiencing a bullish sentiment, which is putting pressure on the GBP/USD pair. The USD Index (DXY), which measures the USD against other currencies, is near its highest level since July 7, backed by expectations of a strong US economy that could keep interest rates higher for a longer time.

However, the recent positive US ADP jobs report, showing 324K jobs added in July compared to the expected 189K, further reinforces this view. Despite the Fitch downgrade of the US credit rating, the elevated US Treasury bond yields support the USD and limit the upside for the GBP/USD pair.

Upcoming US Macro Data and NFP Report: Potential Impact on GBP/USD Pair

Looking forward, traders will closely monitor various US macroeconomic data, including jobless claims, service industry activity, and factory orders. These indicators, along with US bond yields and overall market sentiment, will influence the demand for the US Dollar (USD) and create short-term trading opportunities for the GBP/USD pair.

GBP/USD - Technical Analysis

Yesterday, the GBP/USD pair experienced a bearish trend, successfully reaching the initial target at 1.2725, and even closing below it. This development strengthens the possibility of a continued downward correctional trend, with the next significant target at 1.2625.

The formation of a Double Top pattern signals further negativity, potentially leading the price to test 1.2500. As long as the price remains below 1.2835, the bearish trend is likely to persist.

For today's trading, we expect the GBP/USD to move within the range of support at 1.2620 and resistance at 1.2790. Our analysis indicates a bearish trend for today's session.

Daily Price Outlook

During yesterday's evening, the GBPUSD pair displayed significant bearish movement, breaking below the support line of the previously established bullish channel. Upon closer analysis of the chart, it becomes evident that the price has formed a double top pattern, signaling a potential decline in the upcoming trading sessions.

This bearish correction aligns with the longer-term perspective, considering the bullish wave measured from 1.2308 to 1.3142.

As such, we anticipate witnessing negative trades in the near future, with the next target set at 1.2725. However, it is essential to keep in mind that a breach of the 1.2825 level will halt the expected decline and pave the way for the price to resume the main bullish trend.

For today's trading range, we expect support at 1.2710 and resistance at 1.2880. Traders are advised to closely monitor price movements as the pair navigates this bearish correction phase.

 GBP/USD - Trade Idea

Entry Price – Buy Limit 1.27631

Take Profit – 1.28569

Stop Loss – 1.27165

Risk to Reward – 1: 1.2

Profit & Loss Per Standard Lot = +$938/ -$466

Profit & Loss Per Micro Lot = +$93/ -$46