GBP/USD Forecast – British Pound Bearish Within Range Vs US Dollar

GBP/USD Forecast – British Pound Bearish Within Range Vs US Dollar

  • – The British Pound traded in a range below the 1.2915 resistance against the US Dollar.
  • – There is a crucial expanding triangle pattern with resistance near 1.2915 forming on the hourly chart of GBP/USD.
  • – Today in the UK, the Net Borrowing report for July 2017 was released by the National Statistics.
  • – The outcome was above the forecast of £-0.200B, as the Net Borrowing came in at £-0.760B.

 

UK’s Net Borrowing

Recently in the UK, the Net Borrowing report for July 2017 was released by the National Statistics. The market was positioned for the Net Borrowing to post £-0.200B, compared with the last £-6.218B.

 

However, the actual result was above the forecast of £-0.200B, as the Net Borrowing came in at £-0.760B. On the other hand, the last reading was revised from £-6.218B to £5.673B. When we exclude public sector banks, the Public sector net borrowing declined by £27.0 billion to £45.1 billion. The report added that:

Public sector net debt (excluding public sector banks) was £1,758.3 billion at the end of July 2017, equivalent to 87.5% of gross domestic product (GDP), an increase of £143.9 billion (or 4.5 percentage points as a ratio of GDP) on July 2016.

 

Overall, the GBP/USD pair might recover a few pips in the near term, but the 1.2900-1.2915 levels are likely to prevent gains.

 

GBP/USD Technical Analysis

The British Pound mostly trading in an expanded range with a monster resistance near 1.2915 against the US Dollar. Recently, the GBP/USD pair traded close to the 1.2915 level where it faced sellers and moved down below the 100 hourly simple moving average.

 

GBP/USD Technical Analysis British Pound US Dollar

 

The pair traded below the 1.2880 support and formed a low at 1.2841. There is a chance of a minor correction towards the 38.2% Fib retracement level of the last decline from the 1.2916 high to 1.2841 low.

 

However, there is a connecting bearish trend line at 1.2900, which is likely to act as a major hurdle. Moreover, the 50% Fib retracement level of the last decline from the 1.2916 high to 1.2841 low along with the 100 hourly simple moving average at 1.2878 is also a major resistance.

 

Overall, selling rallies in the near term towards the 1.2900-10 levels with a stop above a crucial expanding triangle pattern with resistance near 1.2915 on the hourly chart.

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