Pound stays vulnerable – GBPUSD Forecast

  • A somewhat confused new lockdown directive from the UK government on Sunday alongside a rather cautious changes of advice and rules has seen the Pound stay under negative pressures versus the US Dollar.
  • There is also a negativity from both the high number of cases and deaths in the UK relative to mainland Europe and also regarding the lack of progress in trade talks with the EU.
  • Here we look at the negative bias for GBPUSD from a technical analysis perspective.

GBPUSD day trade outlook: A negative tone

A Monday selloff through 1.2356/48 supports for GBPUSD to hold just above he spike low at 1.2266 (at 1.2283), but whilst capped by 1.2374 we see  negative pressures from the late April rally failure and May selloff from just below the key 1.2647 peak (from 1.2643), to keep the risk back lower into Tuesday.

  • We see a downside bias for GBPUSD for 1.2283 and 1.2266; a break below maybe aims for 1.2247 and 1.2217.
  • But above 1.2374 aims for 1.2467 and 1.2483, which we would look to try to cap.

GBPUSD intermediate-term outlook

The latter April GBPUSD selloff below 1.2287 saw an intermediate-term shift from bullish to a broader range we see as 1.2163 to 1.2647.

  • Downside risks: Below 1.2163 sets an intermediate-term bear trend for 1.1639 and maybe 1.1410.
  • Upside risks: Above 1.2647 sets an intermediate-term bull trend for 1.3200 and maybe 1.3515.

4 Hour GBPUSD Chart

GBPUSD chart

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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