Pound lower, pre and post Bank of England (GBPUSD Forecast)

Intermediate
  • The Pound saw a notable selloff against most currencies even before the Bank of England’s (BoE’s) Monetary Policy Committee (MPC) announcement on Thursday.
  • Despite the BoE being very slightly on the hawkish end of the spectrum compared to market expectations, the subsequent Pound bounce against the US Dollar (GBPUSD) was minor and short-lived.
  • Furthermore, ongoing global concerns regarding fresh outbreaks and a possible second wave of the COVID-19 virus have seen Forex markets in more of a “risk off” phase this week.
  • This has left the US Dollar in a solid, safe haven position, leaving the GBPUSD forecast negative for today.

GBPUSD day trade outlook: Intermediate-term shift to a broader range

A Thursday plunge below 1.2454 and 1.2425/20 supports, to reinforce the mid-June spike lower to new 1.2454 support, after the plunge below the accelerated up trend line from late May, to keep the risk lower into Friday.

  • We see a downside bias for 1.2403 and 1.2374; a break here opens risks towards 1.2332 and maybe key 1.2290.
  • But above 1.2479 aims for 1.2549, maybe even towards 1.2580.

GBPUSD intermediate-term outlook

The early June rally above 1.2467 and then 1.2647 saw a shift from an intermediate-term bear trend to a broader range and then to an intermediate-term bull trend.

  • Upside risks: We see an intermediate-term bull trend for 1.3000 and maybe 1.3200.
  • What changes this? Below 1.2290 shifts the an intermediate-term bull trend to neutral, and below 1.2075 to an intermediate-term bear trend.

4 Hour GBPUSD Chart

4 hour gbpusd chart 2020-06-19

Editor in chief

Steve Miley has 29 years of financial market experience and as a seasoned expert now has many responsibilities. He is the founder, Director and Primary Analyst at The Market Chartist, the Editor-in...continued

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