GBP/USD Daily Price Forecast – GBP/USD Moves Range Bound Despite USD Sell-Off

The GBPUSD pair on Thursday saw some amount of volatility in London market hours, however closed flat on Thursday. With Brexit woes plaguing UK’s market and talks of polls to cancel Brexit popping here and there in the country, sentiment surrounding British Pound has been negative in global market. While risk appetite has returned to market and investors across the world are investing in major global currencies following USD sell off on news of proceedings on Sino-U.S. trade related talks, Sterling remains locked well inside this week’s high and lows as it lacks the necessary trigger to make a bullish breakout with GBP investors on constant high alert for any negative news surrounding Sterling, resulting in very less long positions and a high volume of short positions which keeps pushing the pair inside a range bound price action with traders skimming off profits on every possible occasion. As of writing this article, GBPUSD pair is trading at 1.2731 up 0.13% on the day after touching an intra-day high of 1.27322.

Brexit Proceedings Remain Primary Focus of GBP Investors

The GBP/USD is seeing cautious play just above 1.2700 as the Cable continues to lift from the week’s low of 1.26615, but Brexit concerns continue to hang over all other issues for the UK, and continued failure to see an aversion of a hard Brexit scenario will see confidence in the GBP evaporate once again. Retail Sales came in better than expected yesterday, clocking in at 3.5% for the year into June, but the mid-week’s showing of inflation which saw the UK’s CPI barely claw its way to the market’s forecast of 2.5%, and the positive showing from Retail Sales has seen limited effect, and the GBP/USD heads into Friday’s London market session with overall market sentiment firmly in the driver’s seat and traders’ attention focused on Brexit, which sees hard-line Brexiteers in Britain’s parliament threatening to outright reject any trade deal brought by the Chequers, essentially promising to sabotage Brexit preparations and forcing the UK into a hard Brexit if Prime Minister Theresa May can’t secure a workable deal from European Leaders when Brexit negotiations begin anew this month.

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A failure by GBP bulls to force a meaningful recovery above key technical indicators is leaving the GBP/USD stuck in a still-bearish market stance. The short-term picture for the GBP/USD pair is neutral-to-bearish, as it was unable to advance beyond its 20 SMA in the 4 hours chart, while technical indicators keep hovering within negative levels, lacking clear directional strength. The yearly low, achieved this week at 1.26615 is the key support that could be challenged with negative Brexit headlines, opening doors for a continued decline toward the 1.2500 region for the upcoming weeks. Expected support and resistance for the pair are at 1.2665, 1.2620, 1.2575 and 1.2745, 1.2760, 1.2795 respectively.

 

This article was originally posted on FX Empire

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