Forex Market: GBP/USD daily trading forecast

Yesterday’s trade saw GBP/USD within the range of 1.6611-1.6726. The pair closed at 1.6620, losing 0.61% on a daily basis.

At 6:43 GMT today GBP/USD was down 0.01% for the day to trade at 1.6616. The pair broke the first key weekly support level and touched a daily low at 1.6602 at 6:00 GMT.

Fundamental view

United Kingdom

At 8:30 GMT Bank of England is to publish the minutes from its most recent meeting on policy. Released two weeks after the meeting itself, the minutes provide a full account of the policy discussion, including differences of view. They also record the votes of the individual members of the Monetary Policy Committee (MPC). On August 7th all 9 members of the Committee probably voted in favor of keeping the benchmark interest rate and monetary stimulus unchanged. In case the central bank demonstrates a hawkish view in regard to inflation pressure in the UK, this heightens the probability of an interest rate hike, which has a positive effect on the pound. A dovish view, on the other hand, has the opposite effect.

The gauge of industrial orders in the United Kingdom probably climbed to a reading of 4 during the three months through August from 2 during the preceding period. This indicator reflects the net balance between companies, that registered an increase in industrial orders during the respective period of three months and those, that registered a drop. It is the oldest indicator, released from the UK private sector, to show the development tendency in countrys industrial sector. The Industrial Trends Survey by the Confederation of British Industry (CBI) provides expert qualitative opinion from senior manufacturing executives, on past and expected trends in output, exports, prices, costs, investment intentions, business confidence and capacity utilization. If the survey showed predominant optimism, this would certainly support the sterling. The CBI will announce the results of its survey, encompassing 17 industries, at 10:00 GMT.

United States

At 18:00 GMT the Federal Open Market Committee (FOMC) will release the minutes from its meeting on policy held on July 29th-30th. The minutes offer detailed insights on FOMC’s monetary policy stance. This release is closely examined by traders, as it may provide clues over interest rate decisions in the future. High volatility is usually present after the publication.

Technical view

According to Binary Tribune’s daily analysis, the central pivot point for the pair is at 1.6652. In case GBP/USD manages to breach the first resistance level at 1.6694, it will probably continue up to test 1.6767. In case the second key resistance is broken, the pair will probably attempt to advance to 1.6809.

If GBP/USD manages to breach the first key support at 1.6579, it will probably continue to slide and test 1.6537. With this second key support broken, the movement to the downside will probably continue to 1.6464.

The mid-Pivot levels for today are as follows: M1 – 1.6501, M2 – 1.6558, M3 – 1.6616, M4 – 1.6673, M5 – 1.6731, M6 – 1.6788.

In weekly terms, the central pivot point is at 1.6731. The three key resistance levels are as follows: R1 – 1.6803, R2 – 1.6915, R3 – 1.6987. The three key support levels are: S1 – 1.6619, S2 – 1.6547, S3 – 1.6435.