GBP/USD Daily Forecast – Cable Stuck Near 1.2632 Levels Amid Brexit Pessimism

The Cable showcased another consolidation mode in the early hours following a plunge rally. The pair had remained stuck near 1.2630 levels, moving neither up nor down. Considering the risk-off sentiment around the pair developed out of an uncertain Brexit, investors seem to go unnerved. They have already started shifting towards more safe-haven assets.

On the Brexit side, there lacked the appearance of any new headlines today. Brushing up the previous data, May prepares to make her resignation on June 7 with a heavy heart. Boris Johnson sleeves up as probability of him succeeding Theresa May stays high. However, with any new PM in position, hard Brexit would continue to remain as a nightmare for the Britishers.

In the meanwhile, Boris gets accused of misconduct by 2016 EU Referendum Campaigner, Marcus Ball. The Campaigner has filed a petition against Boris claiming that he lied of giving EU £350m a week. Marcus himself had crowdfunded around £200,000 for the campaign. However, arguments claimed the action as an attempt to disqualify Boris from reigning as the new PM.

According to the Society of Motor Manufacturers and Traders (SMMT), the UK car production had dropped around 44.5% on March 29. Factories had remained closed on this earlier departure date. SMMT had taken this decision so that the factories could start training over new custom procedures and other formalities. Anyhow, the organization resist repeating the same on October 31, considering ongoing production slowdown.

In and around, Brexit has created a sour sentiment around the Cable Investors.

GBP/USD Influential Events

There is hardly any GBP-specific economic data lined up for the day. However, a few moments ago, BoE’s Ramsden expressed his economic outlook opinions in Scotland. The Governor talked about his gloomy views over the GDP growth and alerts signs of sluggish economic efficiency.

In the European session, US Q1 GDP reports are about to come at around 12:30 GMT. Market set a bearish stance on the YoY GDP data, whereas bullish prospects over the QoQ data. In the same time frame, Street analysts take an in-line expectation over the Q1 PCE and Core PCE data.

Technical Analysis

45-Minutes Chart

The GBP/USD pair appeared capped at the bottom of the Ichimoku Cloud (IC) on attempts to stabilize at the bottom of the channel and in the 1.2623 levels. The flattening Ichimoku Clouds signal that the pair may extend its neutral performance in the short term. Notably, the Central line of the IC hovered above the pair and also acted as a resistance line. Moreover, the Fiber seems taking rounds slightly below the Base Line of the IC. This position indicates bearish prospects in the near term. The RSI was above 40 levels, alluding moderate buying. Also, the Moving Average Convergence and Divergence (MACD) indicated a bear call.

3-Hours Chart

Following the 3-Hours Chart analysis, the Simple Moving Averages (SMA) pointed out an extremely bearish outlook for the Investors. The 50-days SMA appeared moving downward intersecting the 200-days SMA, generating a Death-Cross scenario. This situation had occurred last on May 14. A “Death-Cross” condition occurs when the significant 50-days SMA cross over 200-days SMA on the downside. It alludes extreme bearish signals in the long run. Hence, Investors are advised to stay cautious with more probabilities for a price fall. The Relative Strength Index (RSI) showcased 38 levels, indicating moderate buying.