GBP/USD Price Forecast – Dovish Macro Data and Brexit Woes Damper Sterling’s Momentum

The pair is likely to be under huge pressure, mainly due to the uncertainty surrounding the Brexit process. But so far, it has managed to hold on to the 1.32 handle
Colin First
GBPUSD Wednesday
GBPUSD Wednesday

The GBPUSD pair was the only major currency to gain against the dollar on Tuesday, at of the end of the European session post GBP/USD share decline on Monday after news that two ministers resigned because of Prime Minister Theresa May’s Brexit plans. However this recovery momentum was lost after UK’s macro data for the day came out worse than expected. The GBP/USD is cycling around 1.316/1.311 through the week’s action over renewed trade fears as the pair was already stagnating over Brexit related political issues. The five key members of the UK’s parliament resigned from their posts within the UK’s Brexit department at the outset of the trading week, decrying Prime Minister Theresa May’s latest “third option” Brexit proposal, an agreement made at the last Exchequers meeting that the UK’s Boris Johnson called a betrayal of the original Brexit referendum results, before formally handing in his resignation as the UK’s Foreign Secretary.

GBPUSD Under Pressure

Britain’s Brexit Minister David Davis also resigned from his position, along with three other members of the parliamentary Brexit team. Tariff headlines for Wednesday have seen broader market sentiment swing to the downside as the US prepares to bring further tariffs to bear on China, targeting a further $200 billion USD in Chinese goods after Friday’s round-turn set of tariffs by each country saw both sides refusing to back down from their brewing trade war. Wednesday has a thin schedule set for the GBP, with only the NEISR GDP Estimate for the three months into June expected at some point through the day, and forecast at 0.3% (last 0.2%), with June’s RICS Housing Price Balance due late in the day at 23:01 GMT, and forecast at -2% versus the previous reading of -3%.


The 4 hours chart for the pair presents a neutral to negative stance trading around a flat 20 SMA. In the same chart, technical indicators turned lower, but now lacking directional strength and within neutral levels. The pair has an immediate support around 1.3120, where it bottomed several times during the last few hours, with a break below it, increasing chances for a bearish extension later today. Expected support and resistance for the pair are at 1.3120 / 1.3110 and 1.3415 / 1.3155 respectively.

Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.