Pound upside risks with a weaker US Dollar (GBPUSD Forecast)

  • The “risk on” phase has extended through late May into this week, with global stock averages surging to new cycle highs.
  • In the Forex world, the US Dollar continues to weaken (alongside the Japanese Yen), seen very much as a safe haven currency in the COVID-19 world.
  • The positive global view continues to be driven by hopes the easing of lockdowns and the reopening of the global economy.
  • Alongside a weakened US Dollar, the Pound seems to be benefiting from hopes of a positive resumption of trade talks with the EU.
  • Here we again look at the more positive technical outlook for the GBPUSD forecast.

GBPUSD day trade outlook: Shift to a broader range, threat higher 

Again, a firm advance Monday now above key 1.2467 resistance, to neutralise the intermediate-term bear trend and set an intermediate-term range theme again (1.2075 to 1.2647), to keep the risk higher Tuesday.

  • We see an upside bias for 1.2525 and 1.2563; a break above here aims for key 1.2647.
  • But below the 1.2425/20 area targets 1.2274, maybe even towards the 1.2290/78 area.

GBPUSD intermediate-term outlook

The early June rally above 1.2467 saw a shift from an intermediate-term bear trend to a broader range, seen as 1.2075 to 1.2647.

  • Upside risks: Above 1.2647 sets an intermediate-term bull trend for 1.3000 and maybe 1.3200.
  • Downside risks: Below 1.2075 sets an intermediate-term bear trend for 1.1639 and maybe 1.1410.

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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