- Still a positive tone for GBPUSD despite a recent dip, as we had highlighted previously.
- The selloff in the past 24 hours has been driven by a “flight to quality” to the safe haven US Dollar, with the Fed Meeting Minutes highlighting FOMC concerns about the UIS economic recovery.
- Although this US Dollar rebound has sent GBPUSD lower, we see this as temporary and look for recent GBPUSD strength to resume into today and the second half of August.
GBPUSD day trade outlook: Rebound bias, despite dip
A Wednesday prod up to new cycle high at 1.3267 after Tuesday’s very strong advance above the key peak from March 2020 at 1.3200, and despite a significant sell-off below 1.3150 support, whilst above 1.3045 we still see upside forces from the recent surge plus the earlier August dip and a bounce from 1.3005 (above key 1.2981 support), to keep the risk to the upside into Thursday.
Day trade setup
- We see an upside bias for 1.3168; a break here aims towards the new cycle high at 1.3267 and maybe even a key peak from December 2019 at 1.3284.
- But below 1.3045 aims for 1.3005 support, which we would look to try to hold; below possibly opens risk down to key 1.2981.
GBPUSD intermediate-term outlook
The early July push above 1.2542 signalled an intermediate-term shift to a bull trend.
- Upside risks: We see an intermediate-term bull trend to aim for 1.3200, 1.3286 and maybe 1.3515.
- What changes this? Below 1.2981 shifts the intermediate-term bull trend straight to an intermediate-term bear trend.