GBP/USD Daily Price Forecast – “New Improvised Deal” not finding GroundThe GBP/USD pair got hammered to its 4-months low level in the Asian trading session amid Brexit tensions. Investors look north for the UK CPI figures, hoping the pair to recover.
The Cable opened up silent today. However, the GBP/USD pair met with a hard stroke, making it continue the plunge rally. The pair was further pushed down the cliff reaching near its 4-months low level. The pair have recorded a slump of around 0.42% in the Asian trading session.
Though the market expects the majority of the GBP-specific events scheduled for the day as bullish, the pair was heading south. The cause of the pain got developed over fears of a fourth defeat for May. The UK PM had displayed her “new improvised deal” for Brexit, last night. The new version includes contents ranging from guarantees to match the EU employment and environment standards to a second referendum.
Following the presentation of her new deal, several MPs showcased their disapproval and proclaimed that they wouldn’t vote over this. May now begs before Labor Leader Corbyn to support her as she has added points demanded by the Labor.
However, the opposition party seems to show dissatisfaction over May’s new deal. “I genuinely think it would be sensible for the Prime Minister to say I will not now put this package to the vote,” Labour’s Brexit spokesman Keir Starmer told the BBC.
Meanwhile, the market expects a small reversal laterwards post-release of UK April CPI and PPI figures.
GBP/USD Influencing Events
Today the economic calendar appeared heavily occupied with the GBP-specific events. At 08:30 GMT, the April’s Retail Price Index, PPI, and the CPI will get released. The market anticipates April CPI YoY to increase with 0.1% this time. Whereas, the Core CPI YoY is expected to reach near 1.9% to the previous 1.8 %. The street analysts expect the MoM CPI data to go 0.5% high this time.
Furthermore, the National Statistics will issue the YoY PPI Input and Core Output indexes for April. The analysts expect the Input PPI to come near 4.5% and the Output report to 2.2%. Laterwards, the YoY & MoM Retail Price Index is also scheduled to go bullish with the pair.
For Greenback related events, only the FOMC Minutes at around 18:00 GMT is the significant one. The FOMC will discuss the Monetary Policy Decisions and the current US economic situations.
The Cable stood in the lower zone of the 1-Hour Chart, today. The pair was hovering near 1.2668 levels during 07:00 GMT. The pair stood in the lower vicinity of the Bollinger Bands (BB), alluding a bear call. Moreover, the Cable attempted to touch the lower boundary of BB near 1.2663 levels in the Asian session. All the significant 50-days, 100-days, and 200-days Simple Moving Averages (SMA) stood above the pair. The position of the SMA indicated a bearish stance on the pair. Notably, the 50-days SMA was below the other 100-days and 200-days SMA, alluding near term bullish prospects. The Relative Strength Index (RSI) hovered near 31 levels, referring moderate selling.