Forex Market: GBP/USD daily trading outlook

Yesterday’s trade saw GBP/USD within the range of 1.4532-1.4719. The pair closed at 1.4672, surging 2.17% compared to Fridays close. It has been the 126th gain in the past 276 trading days and also a second consecutive one. The daily high has been the highest level since May 31st, when a high of 1.4724 was registered. The major pair has added 1.57% so far in June, following a 0.92% drop in the prior month.

At 6:28 GMT today GBP/USD was edging up 0.23% on the day to trade at 1.4706. The pair touched a daily high at 1.4723 during the late phase of the Asian trading session, making an exact test of the range resistance level (R3), and a daily low at 1.4640 during early Asian trade.

On Tuesday GBP/USD trading may be influenced by the following event as listed below.

Fundamentals

United States

Fed Yellens testimony

At 14:00 GMT is scheduled to testify before the Senate Banking Committee on matters, concerning US macroeconomic outlook. Any remarks made in regard to how outlook could affect the central banks monetary policy have the potential to heighten USD volatility.

Bond Yield Spread

The yield on UK 2-year government bonds went as high as 0.493% on June 20th, or the highest level since May 31st (0.502%), after which it closed at the exact same level to gain 10.4 basis points (0.104 percentage point) compared to June 17th.

The yield on US 2-year government bonds climbed as high as 0.755% on June 20th, or the highest level since June 10th (0.771%), after which it fell to 0.747% at the close to gain 1.4 basis points (0.014 percentage point) compared to June 17th.

The spread between 2-year UK and 2-year US bond yields, which reflects the flow of funds in a short term, shrank to 0.254% on June 20th from 0.308% on June 17th. The June 20th spread has been the lowest one since April 28th, when the difference was 0.246%.

Daily, Weekly and Monthly Pivot Levels

By employing the Camarilla calculation method, the daily pivot levels for GBP/USD are presented as follows:

R1 – 1.4689
R2 – 1.4706
R3 (range resistance) – 1.4723
R4 (range breakout) – 1.4775

S1 – 1.4655
S2 – 1.4638
S3 (range support) – 1.4621
S4 (range breakout) – 1.4569

By using the traditional method of calculation, the weekly pivot levels for GBP/USD are presented as follows:

Central Pivot Point – 1.4252
R1 – 1.4494
R2 – 1.4630
R3 – 1.4872

S1 – 1.4116
S2 – 1.3874
S3 – 1.3738

In monthly terms, for GBP/USD we have the following pivots:

Central Pivot Point – 1.4526
R1 – 1.4722
R2 – 1.4966
R3 – 1.5162

S1 – 1.4282
S2 – 1.4086
S3 – 1.3842