- 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