GBP / USD Forecast: Trendline Supports Sterling at 1.3804
- GBP / USD slips to $ 1.3808 as BOE credit check reports increased unsecured loans.
- UK employment figures are performing well, the UK average earnings index has risen to 7.3% and the change in the number of applicants has fallen to -114.8K.
- GBP / USD is consolidating in a wide 1.3860-1.3804 trading range, looking for a breakout.
GBP / USD closed at $ 1.3828 after hitting a high of $ 1.3900 and a low of $ 1.3805. The GBP / USD currency pair fell amid the strength of the US dollar. Despite hawkish comments from a member of the Bank of England’s MPC, the currency pair remained depressed throughout the day.
BOE Credit Investigation Complete – Lenders Increase Unsecured Credit
The Bank of England’s Credit Conditions Survey, conducted between June 1 and June 18, showed that UK lenders intend to increase the supply of unsecured credit to households in the third quarter.
The Bank said the availability of unsecured credit was already high in three months to May and is expected to increase further in the next three months to end in August. Likewise, loan demand also increased in the second quarter and is expected to increase in the next quarter.
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Bullish Labor Market Figures Underpin Cable (GBP / USD) At $ 1.3820
On the data front, at 11:00 GMT, the UK Average Gains Index rose to 7.3% from 7.1% forecast and supported the British Pound and further limited the loss in GBP / USD . The change in the number of applicants stood at -114.8K versus -32.5K expected to support the British Pound and limit the decline of the GBP / USD pair.
In May, the UK unemployment rate rose to 4.8% from 4.7% forecast and weighed on the pound sterling. At 6.30 p.m. GMT, the CB Leading Index remained stable at 0.6%.
On the US side, at 5.30pm GMT, the Philly Fed Manufacturing index fell to 21.9 from an estimated 28.1 and weighed on the US dollar. Last week’s jobless claims hit 360K against the expected 350K. Both indicators weigh on the US dollar.
The capacity utilization rate also fell to 75.4% from the expected 75.7%. While the Empire State Manufacturing index rose to 43.0 from 17.9 expected. The economic figures supported the US dollar and added further losses in GBP / USD.
The US dollar was strong on board despite the accommodating comments of Jerome Powell on his second day of testimony in the House of Representatives. He reiterated that the Bank would continue to support the economy as the rise in inflation was transient.
MPC member Michael Saunders spits hawkish remarks, boosting demand for pounds sterling
On the other hand, MPC member Michael Saunders said it may soon become appropriate to cut some of the stimulus measures provided to support the economy. Such a comment from Saunders sparked immediate speculation that the MPC may be bracing for an early downside to its quantitative easing program set to meet next month.
According to Saunders, the activity recorded in May was a little faster than the forecast of the Central Bank. In response, one course of action could be a call for the early winding-up of the quantitative easing program.
GBP / USD closed at $ 1.3828 after hitting a high of $ 1.3900 and a low of $ 1.3805. The GBP / USD currency pair fell on Thursday amid the return of the US dollar’s strength. Despite hawkish comments from a member of the Bank of England’s MPC, the currency pair remained depressed throughout the day.
GBP / USD Forecast: Uptrend Lines & Double Supports Below $ 1.3,800
Pivot Point: 1828.20
GBP / USD Forecast Technical Analysis: Eyes on $ 1.3800
The GBP / USD forecast is a bit neutral today as the pair consolidates in a wide trading range of 1.3860-1.3804.
Over the 4 hour period, the cable closed a symmetrical triangle pattern. This pattern indicates investor indecision and provides support at 1.3804. However, resistance remains at the 1.3867 level.
A break out of an uptrend line or downward symmetrical triangle pattern may drive the Pound towards the triple floor of 1.3756.
The 50 period EMA (exponential moving average – red line) holds at 1.3835, as well as the MACD which closes the histograms below 0. Both technical tools support a sell bias in the GBP / USD pair.
The GBP / USD price prediction is neutral today. however, currency trading participants can look for an opportunity to escape. Sell ââtrades can be captured below the 1.3800 level with a target of 1.3750 today. All my wishes.
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